Yes, if she was cashed out for (let's say) $5000, but the check was for $4000, she can roll over the entire $5000 to the new plan if she can make up the difference from other money. She will get a 1099-R showing a withdrawal, Turbotax will ask what she did with the money and one of the choices is "I rolled it all over into another qualified plan." She won't owe tax, but gets credit for the withholding, and it will come back as part of her refund.
As far as depositing the check, as long as it is made out to her, that's fine. Sometimes the check would be made out to "Fidelity on behalf of Jane Smith" or some such, that would mean it goes straight to the custodian and you would have to send a separate check or electronic deposit in the amount of the remaining withholding. And you want to make sure the new 401k plan will accept incoming rollover funds, some plans don't. If the new employer plan won't accept the incoming funds she can roll them over into an IRA that she can establish at any bank or broker that offers them.
This answer has been verified for accuracy by an Intuit expert employee
