My filed 2010 and 2011 on 1099 self employed as married filing head of household filing separate with me . I was collecting unemployment for the whole year 2010 in which I filed and 4 months on 2011 that I didn't file.. we have 2 kids 10 and 17 yrs old.. If she amend her tax for those 2 yrs and file joint , is there any penalty?

Only if taxes are owed. Maybe she can come up with more deductions for 2011 to offset your UI. Filing jointly for 2010 might be better and get a bit of refund to offset 2011.
People often have good luck appealing the penalties, and some of the interest, when they get socked.