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Her doctor can report Mom to the DMV but for my Gson (epileptic) it took 3 months for NJ to write a letter asking that he turn his license in. So in the meantime lose Moms keys. Disable the car and tell her it needs to go to the shop. Take it somewhere else. Don't leave it where she sees it all the time. Out of sight out of mind. My GFs father had ALZ and every night put his wallet and keys in his pants and hung them over a chair. One morning he asked his wife where his pants were. They looked high and low. She told him until they were found he couldn't drive, no keys no licence. She did find them. Way under his mattress. Buy that time he had stopped asking to drive. So she hid everything. Sold his car and got a different one.
If MVD renews her license then it is on them if something happens.
Best of luck. Oh, you could explain to mom that DPOA and MPOA are not effective until they are required. They are for the protection of her in the event that she has an accident, heaven forbid, and is not able to advocate for herself. Does she really want some hospitalist to make life and death decisions for her? I had to tell my dad that I would walk away and never look back if he didn't give me the authority to act on his behalf if he was unable to. It took 10 years of my life trying to get the hospital to treat him after a hospitalist put do not resuscitate in his chart. It was a battle that no one should ever have to fight and POAs stop that. I refused to do it again when he could stop the situation before it began by assigning a POA. Maybe that will get her attention, because when you need a POA it is usually to late to get it.