I overheard that the Patriotic Zolnixi is meant to represent America the USA and forth of july and Independence Day would it be weird or offensive if I name one after Queen Elizabeth?

I'm worried about people getting upset

Well, it'd definitely be weird/creepy if you named a pet after somebody as-is (in my opinion), so you're probably better off just not.

Edit: Also she just passed away so I feel like that adds more to the "please don't" side

If this is to make some kind of memorium pet, a patriotic nixi woudnt be good. The idea isnt bad but the themme selected could use some deeper though, try to look at somthing that could represent what you ment in a better way . A quick google search show me that lions and roses are part of the national symbols so maby a Mildnight Rose would be a better choice if that's what you were aiming for but feel free to check for more possible connections.

It wont be receved negatively if this is done tactfully but yea, maby avoid using her full name as well.