I thought this meant "she's stopped working", or "she's stopped practicing". Is this right or am I wrong?
^^^ Those are my thoughts as well.
This means she reapeatedly or gradatively has been abandoning practice. (did not quit yet)
This Portuguese tense carries a "progressive/repetitive" meaning.
I think your second sentence is better than the official translation.
The Portuguese sentence doesn't imply she's going to a specific place like the official translation.
How would one say "She has left to practice", if not this?
you would say: "Ela saiu para praticar."
"She has stopped practicing" is wrong?
That is "ela parou de praticar".
She has stopped practicing should be accepted as well.