After the two year holding period can a SIMPLE IRA be rolled over/transferred to a SEP?

Yes, the SIMPLE can go to a SEP after 2 years. The rollover rules become the same as for a traditional IRA, according to Tax Facts, citing the 1996 Blue Book, p. 141. Notice 98-4 is a good bet for something on this, also.

Yes, the only difference within the initial two years of a SIMPLE IRA is that there is a 25% penalty on early distributions instead of 10%. So, the 2 year rollover exclusion prevents the taxpayer from rolling to a SEP or other plan in order to incur a 10% early distribution penalty instead of a 25% penalty.

Therefore,

1) after two years, the SIMPLE IRA may roll over to any vehicle.

2) Within the initial two years, a SIMPLE IRA may only roll over to another SIMPLE IRA.

3) A SIMPLE IRA may only accept rollovers from other SIMPLE IRA's.