Well, she could do like me and have her short hair two different colors!
My hair used to be long but it wasn't straight and wasn't curly. It would just not do much of anything. I permed it back in the late '80s and it was past my shoulders and looked pretty hot but after I had kids my hair would NOT take a perm so I had it shoulder length but I found I was always pulling it back and I looked older than my age.
Then I cut it and the difference was incredible. It dropped 5 years off me. Not only that, but it takes 5 minutes for me to fix up. Often I don't even have to dry it and it looks fine. For my lifestyle (working outside, driving in a convertible half the year, camping, kayaking, skiing, etc) it's perfect. Long hair is just too much of a pain.
That said, I didn't get it cut like a guy. My hair is short on one side and longer on the other and I spike it up top. It's blonde up front, down one side (the longer side) and on top. It's dark, almost black, on the back and the other side.
I get a lot of compliments about it (my husband seems to like it) and it certainly is different and tends to go with the way I dress and reflects my personality. A lot of it has to do with the close relationship I have with my hair stylist too. She is easy to communicate with and we are of the same mindset so we work well together.
I find that a lot of women just get their hair cut short but there's no real "style" to it. Sometimes it looks like someone stuck a bowl on their head and just cut around it. Maybe your wife needs to find a hair stylist who will give her a bit more style so that it's not so "guy-like" but be short and sexy. If she leaves it longer on top you might find the compromise you are both looking for. Perhaps you can pick up some magazines and go through them together and come up with a compromise that both of you you would like...One that you find appealing and that she can live with.
One thing that does raise my eyebrows is her cutting it herself shorter and shorter. It sounds a bit "off" to me...almost like she's doing it out of resentment or has a deep seated problem. Sounds a bit like cutting. You cut (be it skin or hair) because you feel anxious and angry within yourself. As someone who has cut I can relate here. Have you noticed any other changes about her demeanor besides the hair?
I'd be very careful and gentle with her. Give her a hug and ask her why she cut herself and keeps cutting it. Be supportive and for the time being focus on the other parts of her body that are attractive to you. Sounds like she's needing some lovin' and support and maybe some counseling too?