I cannot respond on the issue of a preemie, but on nursing in general. Irritation is a normal part of starting to nurse but ongoing and deep pain is not. It might mean her latch is not good for some reason.
My first advice is to have her ask her OB for this prescription from a compounding pharmacy. It saved me a lot of pain. I'm no crazy homeopath, it is something my lactaiton consultant recommended and my OB perscribed and it really helped much more than lanolin. Just make sure as a preemie there are no counterindicaitons. I pasted it at the bottom of this response.
Second, I urge her to see a lactation consultant. They are much better than just a nurse on the postpartum ward. Pay for a private session or two where you can work on the latch and sucking. I don't see any reason she shouldn't nurse at all feedings if the latch is right and not causing pain. A LC is a magician at fixing problems. I found La Leche was a nice support group of nursing moms, but to deal with this you will really want somone hands-on. I nursed for well over a year both times and both times I had major start-up issues.
Congratualations and good luck!
APNO (All Purpose Nipple Ointment) is a compounded ointment mixed from the following ingredients:
Mupirocin 2% ointment (15 grams)
Betamethasone 0.1% ointment (15 grams)
To which is added miconazole powder so that the final concentration is 2% miconazole. This combination gives a total volume of just more than 30 grams. Clotrimazole powder (not as good as miconazole) to a final concentration of 2% may be substituted if miconazole powder is unavailable, but both exist (the pharmacist may have to order it in, but compounding pharmacies almost always have it on hand). Using powder gives a better concentration of antifungal agent (miconazole or clotrimazole) and the concentrations of the mupirocin and betamethasone remain higher. Sometimes we will add ibuprofen powder to a final concentration of 2%.
The ointment is applied sparingly after each feeding (except the feeding if/when the mother uses gentian violet). “Sparingly” means that the nipple and areola will shine but you won’t be able to see the ointment. Do not wash or wipe it off, even if the pharmacist asks you to. The APNO can be used for any cause of nipple soreness ("all purpose nipple ointments"), not just for Candida (yeast). Use the ointment until you are pain free for a few days and then decrease frequency over a few days until stopped. If you are not having less pain after 3 or 4 days of use, or if you need to be using it for longer than two or three weeks to keep pain free, get good help or advice.