Her baby is doing what I like to refer to as "newborn frog legging." I always tell parents at prenatal checks that they need to make sure to straighten baby's legs enough to have the hip strap sitting against them at the hip, and not across the lower end of the upper part of the leg/knee like is shown in this picture here. (Man, hard to describe in words the area I'm talking about, but I think looking at the picture that this will make sense?)
Have mom make sure that the strap is going right across the top of the leg - it's correct on the one side, just not on the other where you can see the knee is almost under the strap. Then she'll be able to tighten the harness up better. I think if the strap had been positioned properly she probably would've gotten the harness the correct tightness. As it was, it probably got snug on the one shoulder before the other and she wasn't able to tighten it further.
It actually looks like the seat fits pretty good though.