Sorry to hear about your sister's situation. It's nice of you to step in to help. There are serious consequences to both short sale and foreclosure. When you speak to a lawyer be sure to understand fully the importance of a Release of Liability and deficiency judgment. Please check for yourself, but I believe the Mortgage Forgiveness Debt Relief Act expires this December. Hint...
May I ask how far under water she is? If the market in Naples increased annually 20%, how long before she is whole? If the answer to that question is never, then it may make your decision a little easier.
Your lawyer will have a good strategy for you. If it involves selling, and I hope it doesn't, I may know someone who might be able to help.
Best wishes,
H