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I am her son and am her Durable POA. My mother has been using the card with no issues thus far, but the Nursing Home she will be moving to requires as part of her documentation her Medicare Card and the spelling is incorrect for her last name. The spelling should have an "a" but has an "o", and is one letter off.

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Contact the Medicare folks immediately and get it fixed. Fraud is so prevalent in the system that the NH can be held liable if they take incorrect documentation. If you have internet access, you can go the medicare.gov website and type in incorrect medicare card. She can order corrected card or get info on office locations there.
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YIKES call them ASAP and get it straightened out.
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