Even though the flight was in Toronto when delayed, it was still covered by the EU regulations on delayed flights (since BA is an EU airline), meaning it sounds like she should have got meals and communications provided, as per the regulations.
And yes, the bags. BA has been horrendous on bags at the moment. The problem with that is that everyone is complaining, which means no-one is getting a satisfactory response - and in some cases, no response at all. Should BA compensate? They should certainly cover any reasonable costs she incurred because of delayed baggage. Compensation is always a sore point on this board, and it would depend on the reason for delay - to delay a flight because the plane needs fixing is pretty reasonable (unless your sister is happy to fly on an unsafe plane?

). I presume your sister was able to make her connection at LHR?
(In short, it's probably worth a letter saying how disappointed she was by the situations she encountered, but don't hold your breath

)