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By the complete description of your PSA, I would say she is perfect for the NCAA Division III category. DIII offers a wide range of physical statures and varying academic/athletic demands, but in general, the players tend to be smaller than DI/DII and more intellectual in their volleyball, not too mention school.
A 5'8" all around Outside Hitter with a strong work ethic will do very well at the DIII level and enjoy a great volleyball experience.
I encourage you to pursue that level, especially if you have the financial means as to not 'need' the assistance of an athletic scholarship. For those families which would need the support of an athletic scholarship, then I would have them target those DII or NAIA programs which enjoy a great academic reputation.
With DIII, one item to be aware of, is the early application/review policies of some of the more elite schools. Because of the academic standings, some DIII's will have a firm application deadline which can be surprisingly early. Sometimes families will come to the conclusion that NCAA DIII is the best level for their daughter, but do so later in the senior year and many DIII's have closed their application acceptance period!
Good luck and move forward with confidence in the DIII arena!