Nanny is a mutant, she is a low level telepath who uses some kind of dust effect to amplify her ability to control people.
She was a scientist who was working on cybernetic project that she thought was going to help people with physical disorders, but then she found out that the program was designing cybernetic weapons to use against mutants and when she challenged the management about it, they knocked her out and installed her inside one of the experimental cybernetic devices and locked her in. She can still use her powers, but she is unable to get out of the cybernetic casing, possibly because they may have amputated her or worse when the put her inside it.
I am actually curious of Nanny and Orphan Maker were to die and then go through the resurrection process, it would be interesting to see them both restored to their original bodies. Peter is a very powerful Omega level mutant whose powers are very destructive. It's possible he is a reality alteror like Proteus and Jamie. Sinister was going to kill Peter, but then Nanny rescued him, and de-aged him to make his abilities stable and then put him in the armor to both protect Peter and to help Peter control his powers. It's possible that Peter actually powers the Orphan Maker armor with his own powers.