It will be her decision, but that is not to say that circumstances will not force her hand. Let's say that Iowa somehow pulls off 11 wins and gets into the playoffs, maybe even wins a game. KF announces his retirement, states that he fully endorses Wallace to succeed him, and further states that the entire remaining staff also supports the hire and intends to stay. Now, by law Beth has to post the opening and I am sure there are some hoops to jump through. She might even quietly kick the tires on a few higher profile names, but she would be very hard pressed not to keep the gang together and elevate KF's choice.
But, I agree that she will make her own decision, unlike Barta who would have done whatever KF told him to do.