After getting an email that my sister's iphone 4 had been removed from her account, I'm still being prompted to enter the apple ID and password to activate the iphone. But I keep getting the message: this ID cannot be used to activate this iphone.

For very good reasons, selling or giving away one's phone must follow exact procedures...

What to do before selling or giving away your iPhone, iPad, or iPod touch - Apple Support

Find My iPhone Activation Lock: Removing a device from a previous owner’s account - Apple Support

Activation Lock Status Checker

What if i can get in contact with the previous owner

Sorry, but if the previous owner did not do what they were supposed to do and there is still an Activation lock on the phone, then you purchased a nice souvenir or a paperweight. If you bought it on ebay or some such place, put in a complaint and ask for your money back.