I grew up in Dunkirk and there is really nothing there anymore, not that it was bustling by any stretch of the imagination when I was there. Such a shame, it's right on the water with beautiful views. They fixed up the Marina, which is really nice, but that's about it. Houses are definitely cheap there. That being said, if you Mother has been there for some time, is she willing to leave? My parents still live there and I would have to drag them out.
If she's willing to move, I would choose the northtowns (Amherst, Getzville, Williamsville, Clarence, Lancaster) personally. If your mother wants to stay in Dunkirk, I would go with Eden or Hamburg, 30 minute drive to/from Dunkirk.
People always complain about the taxes, but the overall cost of living is relatively low in this area and I really think it pretty much evens out in the long run.
Best of luck!