The real limiter is the suspension. It sucks. As soon as she starts jumping you need to stock up on lower steering stem bearing races. They crack like eggs.
As far as the bike goes motor wise the gearing is too tall, the compression is too low, the carb too small...You can get the right gearing $175 at yamaha, or $60 onE-bay different reeds, bore the carb, Increase the compression. Change the porting. get the fmf pipe. When it comes down to it you can easily spend a grand and make it a so-so mxer. When you look at the other two racers in the same class (class 3) you will find the Cobra PW3 and the KTM Mini Adventure OI. Both of which totally smoke the PW50. What I'd suggest is just using the PW50 as designed. A great un-intimidating bike to learn on. And when your rider is ready to make the jump get a bike that comes stock with great suspension. The suspension will hlep here riding way more than ANYthing you can do motor-wise to the pw. The best bang for your buck will be changing the ring and pinion. After that maybe playing with the clutch springs. The clutch hits when the rider even thinks of turning the throttle. If you increase the RPM's a bit its a big advantage. Like I alluded to you can just chop one coil off the spring and rebend it so they fit and it will help a bunch. For a better suited hard hitting spring you will find some for under $20 at
www.paxraing.com and a spring guy in OK on E-bay. If you have the facilties to do your own milling then have at the head. They really wake up with some compression. Most guys take material off the cylinder but I have seen a guy on E-bay claiming his heads work best.