"They can however certainly convict based on the JC Penney case for perjury and Insurance fraus as well as the welfare fraud..."
You must be new to the justice system. Almost no conviction is certain. I'm sure prosecutors would have loved to pursue perjury charges against MJ when he denied even knowing a boy he slept with 365 times. Same goes for the OJ lie about shoes. But, they didn't, because it's very difficult to prove, and little punishment results.
The law should make being caught in a lie, like being caught with illegal drugs. If you're caught with illegal drugs it's very hard to "get off" by claiming you didn't know where they came from. With perjury, people shouldn't be able to get off easily, by claiming memory failure. But that's not how the law is written today.
As far as welfare fraud. She pretty much did the equivalent of a person not declaring income on their tax return. The vast majority of such people are never prosecuted. They have to repay the money, with penalties, might be barred from future claims, and that's about it.
Because of the publicity, though, it appears there is a chance the welfare fraud case will go forward.