re: How to leverage new job offer for raise/benefits at current job?

Just use leverage. Figure out what job she wants most, and bring some kind of hard figures to both to see what kind of salary she can justify she deserves.

The idea that someone shouldn't ask for a raise and a company would hate an employee that does is outrageous, if a manager and employer does not want an employee to justify a raise occasionally then they are both a terrible employer and I say screw them.

We are no longer in the 20 and a pension era. You work for yourself to make the most that you can in the best environment. You work for your current paycheck, very little more.