The benefits she mentions are legitimate, even though two of them have nothing to do with Berlin and could be obtained by moving to any new city. (no distractions, and changing environment equals greater creativity)

So it really boils down to this for her: Berlin is affordable and it has a good meetup scene. Affordable is relative, salaries are lower in Berlin than in many other cities and the cost of living has been on a rise as more people move in, but at the moment she is absolutely right about this much: cost of living is still significantly lower in Berlin than in London (https://www.numbeo.com/cost-of-living/compare_cities.jsp?cou...) [1]

Depending on your product Berlin can be good or bad. I think its almost always a great fit if your product targets the German market initially and you want to eventually expand out from there. The other way around will be much more difficult, mainly because you're sitting in Germany and you're whole business side of operations must be run in German, under German law, rules, and regulations.

Having said this, as far as her specific product idea goes, I could see Berlin being a good fit for her. The super young hipster culture is pervasive throughout Berlin, and it seems like an idea that would work well in that market.

1. I worked on a German startup for 3 years in Berlin