Question 22 is only completed if she is in the U.S. and applying for adjustment of status
I thought the same thing, however the second part addresses the overseas location. I need to no how to correct this since it has already arrived at the lock box in Chicago.
The entire question is only filled out if she is in the U.S. and applying for adjustment of status.
Or if they want consular processing but want it to be in a different country than their country of residence (provided they're also eligible for CP in the requested country). For example, a British citizen living in Germany can choose to be interviewed at a consulate in the UK; if they leave question 22 blank, by default they'd be assigned to a consulate in Germany.
Correct, you didn't screw up by leaving it blank. It also would have been OK if you requested a consulate in Kuwait.