I fully agree with K's comments:
"So forget family etiquette, the sister is ALREADY not
speaking to anyone..... send her some info with a kind note about how you care
for her children and thought she would benefit from the info.  But tell her in
a way that she looks fine... ie. "I never would have known myself about our
allergies if it were not for someone helping me..."  LIE.... but do it for the
children."

BUT i would add, don't expect her to actually do something about it!  Many
people DO take offense at advice however well-meaning (or accurate). I have
a friend with a daughter covred with eczema, eating lots of dairy at daycare,
having lots of respiratory infections, who REFUSES to even consider the fact
that she might have a problem with diary.  Her answer: SHe LOVES cheese, she
LOVES milk, milk she says is a MIRACLE food!  Her husband had childhood
and adult asthma and her mother was anaphylactic to insect stings.  Despite
her history, she cannot give up on this great white food which as she says,
"YOu see a kid with a glass of milk and you KNOW they are well-fed."

The other reaction I find is that people think that because it is Your concern,
having kids and your own allergies, that you overreact to other people. THe
response I get here often is, "Well, you nmight have it, but not everyone
has it."

I tell them and I feel bad for their children (wheezing still, itching still)
but I can't force them to do anythign!

Susan.