"Everyone should sleep."
Translation:सबको सोना चाहिए।
Well, what does exactly "chahna" mean - to want or should? Since these meanings are completely different. How can i see if everyone wants to sleep (since they are really tired), or it's better for them to sleep (since they'll have to work hard tomorrow)?
It's better to think of the form चाहिए as being a separate word than the root-verb चाहना. चाहना and all its other forms always mean 'want'. चाहिए is different.
When used with a verb as in this sentence, चाहिए indicates modality ('should' or 'need to'). So this sentence conveys the second meaning you have listed.
When used with a noun, चाहिए can mean 'want' although the sentiment is a little stronger than when using other forms of चाहना. Eg: मुझे दो आम चाहिए - 'I want two mangoes'. In other contexts, it can mean 'need'. Eg: सबको जीवन में शान्ति चाहिए (Everyone needs peace in life).