Hi. I had a c-section for placenta previa with dd1. (I bled on and off from 27 weeks, was in hospital for 10 weeks, and had my op at 36 weeks!!!!)
There is a higher risk of bleeding with placenta previa, which is why they will take blood to cross-match and save. This is purely a precaution, and I don't think your sister should be too freaked about it. (For example, they also wanted to do it for me when I had my VBAC, although dd2 was in too much of a hurry to arrive, and they never got round to it). They will know where your sister's placenta is, though, from scans, and will do their level best to avoid it. I'm guessing it's anterior as well as previa, if they are worried about cutting into it and are going to cut higher than normal. Mine was (so they said) sunk in my cervix 'like a plug in a sink', so this wasn't a problem. Also, at 38 weeks your sister's baby will be very well-developed (38 weeks counts as 'full-term') so there are unlikely to be any problems with him/her being small, etc. Has she been bleeding up till now? My dd was smaller than expected for 36 weeks, but I think that's because I had lost a piece of placenta somewhere along the way (sorry if TMI...hope you're not eating your dinner). Is your sister in hospital now? If not, just tell her to stay near-ish to the hospital, just in case, and to gotraight in (as in 'do not pass go, do not stop to pack'!) if she either suspects she might be in labour or starts to bleed.
Placenta previa can be serious, there's no doubt about it. In this case, however, the c-section is a life-saver. I found mine to be an incredibly positive experience - very relaxed (after a very stressful pregnancy) and very happy. And I felt very 'safe' throughout... after feeling like a ticking time bomb waiting to go off for the previous 9 weeks!
Good luck to your sister. If you want to know anything else just ask. (Oh, and invest in some big pants for her for after the op. They are a life-saver. The bigger the better, especially if they are going to cut her a bit higher than normal.)