"Ist sie eine Freundin?"

[beckalina]

I don't know for sure that it's the same in German but in French you can tell whether someone is referring to a female friend or girlfriend (or male friend vs boyfriend) by whether they say 'a friend/a friend of mine' (one of several friends and so not romantic) or 'my/your friend' (the possessive article indicating girlfriend/boyfriend) -could be similar here

[christian]

You're right.

[adam.wes.hall]

Does Freundin mean friend here, or girlfriend (as in lover), or is it ambiguous?

[christian]

Technically, it's ambiguous, but the indefinite article "eine" suggests we're talking about a female friend (non-romantic).

[chubbard]

Someone like Christian will be able to give you a definitive answer. I've just got opinions.

To me, it most certainly could also mean just "friend". I think, like you suggested, it is ambiguous when just given this sentence by itself. In real-life, hopefully you could decide which way made the most sense based on whatever conversation surrounds it.

[VCSD]

Why is "sie" not capitalized?

[christian]

It's only capitalised when it means "you" (formal).