When a baking recipe calls for alcohol does that cook out, like when you cook the wine out of a sauce in a hot pan?

She should get the advice of her doctor on this. For some people, it won't be enough to matter - for others, it could be dangerous.

Here's a list of subs for alcohol for both cooking and baking:

http://whatscookingamerica.net/alcoholsub.htm

But I agree - there are so many great things to bake that don't involve alcohol, that I'd just go with one of them.

However: vanilla extract is 35% alcohol - i.e., a cake with 1 teaspoon extract contains about 1/3 teaspoon alcohol. If the cake serves 8, that's only 1/24th teaspoon per serving; for 10, 1/30th, etc. But if your sister can't tolerate even trace amounts, make sure to use a vanilla bean, or a non-alcohol based extract. (Btw, there are certain meds where even a trace amount of alcohol can cause a bad reaction, but I don't know if this is the case with allergies too.)

In terms of cooking - I'd avoid a recipe like Coq au Vin, where wine is the predominant flavor; but in recipes where it's just one subtle flavor note amongst others, you can usually sub something non-alcoholic (or just skip it) and it will work out fine.

If it's not a lot of alcohol you can just leave the ingredient out. A couple of the baking books I've read have recommended that if you can't use the alcohol that you should just sub a liquid (orange juice or water instead of a couple tablespoons of limoncello for example, or coffee instead of kaluah).
On the other hand if you're making a vodka pie crust recipe that relies heavily on the properties of the alcohol I would find a different recipe.

Thanks for the help. I guess just to be on the safe side, my sister won't get to enjoy anything I make that calls for alcohol in the recipe. Bummer for her :)

Here's a chart about what percent of alcohol remains after different cooking methods: http://homecooking.about.com/library/archive/blalcohol12.htm

Perryskitchen, here is a link that has a good, comprehensive answer, and a useful reference chart that might be of good use to you: http://www.ochef.com/165.htm. Hope it helps, and good of you to be so attentive.

Could you give us an example of what you would be making? It would make it much easier to answer your question.

You have been misinformed. The alcohol never completely cooks out of any dish, no matter how long you cook it, nor how high the heat you use. Some residue always remains.

This is why, when you are cooking for a person who cannot have alcohol in any amount, it is important that you omit that ingredient, or find a non-alcoholic ingredient to substitute.