Yes, this likely means she has dyslexia, though the way the psych put it sounds like it's pretty well compensated in her case, and, no, it is not all that unusual for two siblings to have dyslexia, as there are clearly heritable contributors to it.

I'm guessing there were signs that she had difficulty retrieving symbolic or decontextualized information or skills? Automaticity?

...pronounced like the long vowel and first letter of the alphabet...