She came to the US illegally (from Mexico) with her family when she was 5. She works full time and goes to school. We have been dating for 7 years. I was born in the US. We live in CA. I've read that marrying a partner who entered the US illegally has restrictions. Should she return to Mexico and apply for a fiance visa or a student visa, then should we get married? I don't know what would be the safest course for us. I have had a difficult time finding out information related to changing illegal immigrant status.
A person who is over 18 years old, who entered without inspection (illegally) begins to amass unlawful presence when she reaches 18 year of age. If she leaves the U.S., then she can be subject to the three or ten year bar upon her departure from the U.S. to pursue a visa in Mexico. This means that she cannot return until she can prove that she was out of the U.S. for either the three or ten year period, depending upon whether one year of unlawful presnce has elapsed before she leaves. She must prove her physical presence in Mexico for the 10 year period to the satisfaction of the consular official. This may be easier said than done. However, there may be other options.
Forms of relief, such as cancellation, 245i, and waivers of inadmissibility are best discussed at length with an experienced immigration attorney. These terms are too complicated to reasonably explain without considering each situation. Currently, there is an effort to pass the DREAM Act (actually DREAM Bill); you may want to rally and encourage friends and family to support it, since if passed, it may help her.
I strongly recommend an appointment or teleconference with an experienced immigration attorney, who can discuss options and even refer you to an experienced California immigration attorney, where that is your preference.
The above is general information not meant to be legal advice. The person providing the question needs to provide more information and ask more questions about their 'conceivable options' to reasonably seek enough legal advice.