Could this also translate as "she SHOULD be very happy"?
For Duo it is "Ela deveria estar muito feliz", but in Portuguese it takes the same meaning.
Can you say "ought" instead of "must" ?
Yes, another possible option.
Can someone please explain what verbs modal is about?
Yes, please explain. I dont even know what a modal is in English
It is a type of auxiliary verb that is used to indicate modality – that is, likelihood, ability, permission, and obligation.
Why is "deve" used here instead of "deveria," as in the other examples?
deveria = should
must and should are not equivalent in English. One is imperative and the other normative. I believe this is true in Portuguese. Which is why deveria replaces devia. The script should not allow them to be