headfairy - yes, you do need to be really clear about everything or else it will cause a lot of resentment, then you will also have 4 kids who are used to being a part of each others lives as well to consider if you want to put an end to the arrangement.
It can work really well, I have a friend with 2 girls who has a nanny, she has been there for 7 years, had ML with her son, and other than that has always brought him along, he's 4 now! However, I think it only works for certain personality types - it wouldn't work for me. My friend is really laid back, treats her nanny's DS like a nephew and doesn't resent the inconvenience or cost of having him there at all.
Just a few things I can think of:
Food - you also have to consider school holidays as well as school time - feeding 2 extras at all times - including treats. I think it is simpler for you to cover all the cost of it and pay her accordingly.
Bath stuff - bathwash, bubble bath, shampoo etc laundering of towels. Not to mention the time it takes to bath her two as well.
Stuff - art supplies/baking stuff, it all costs more with 4 kids using it.
After school activities - what are you happy for her to do with her kids that means yours are just tagging along? For example, would you be happy for her one of her DS's to go to swimming classes where your two just have to trail around and get nothing from it, or are all activities on the days she has yours out of the question. I know she's only working 3 days, but sometimes you don't have much choice of which day to attend a class.
Doctors, dentists etc
Visiting her friends, family, toddler groups.
Be clear about things like nappies (if hers are still in them).
What illnesses are you happy for her to bring her kids to yours with? Colds/chicken pox etc If you aren't happy with her bringing her kids if they have CP what is the back up plan? She calls in sick? She has alternative care? ??
Lots of little things, but they become big things if you both make assumptions that are different.
You would probably do really well to start another thread along the lines of 'Nanny bringing her own child, what do I need to consider'.
(I have been doing other things while writing this, so will probably x-post with 10 others who have already said the same thing now!)