You can't always translate English to German 1:1; sometimes, the two languages have different ways of expression things.
For example, "He has a cold" (with noun "cold") versus Er ist erkältet (with adjective erkältet), or "He is hungry" (with adjective "hungry") versus Er hat Hunger (with noun Hunger), or "He likes to swim" (with verb "likes") versus Er schwimmt gerne (with adverb gerne), or ....
Don't look at individual words but more at phrases or expressions -- such as "go for a walk" which, as a whole, can be translated by spazieren gehen.
How are we supposed to know which is which when "Sie" starts the sentence, and the verb conjugation is the same? Imo, both "She is..." and "They are..." should be acceoted in this instance simply because there is no context, and both are correct from a grammatical sense. Please let me know if I'm mistaken, as I'm still learning.
"she is going" = "sie geht"
What I think you meant is the formal you form: "Sie" with a capital "S". So this sentence could be either meant as "They are going for a walk." or "You are going for a walk (, sir/ma'am/s)." The feminine singular version uses a different form of verb though.
I hope I could be of help.