I'm going to nit-pick some things because of the way you phrased things:

1. Was it their "Principal Residence" while they lived in it?
2. Was it their Principal Residence from the time they bought the home until they converted to to rental use?
3. Was it AT LEAST two years (if they merely say "two years", you should get the actual dates)?

If the property was sold at a gain, yes, they will have "Unrecaptured Section 1250 Gain" due to the depreciation that was able to be taken.