If this is a private college or university, the school can lawfully make rules for student residence. Students who wish to attend the school will follow those rules; those who find the rules unacceptable should choose another school to enroll in. It's not that the Handbook is a legal document. The issue is that a private school has the right to condition enrollment on rules that are not unconstitutional or violative of public policy. This rule breaches neither of those standards.
Almost certainly the school has an administrative appeal process through which your daughter can request an exception or exemption from the residence requirement. Details of that policy are ordinarily found in the Student Handbook, deep in the web-site, or through the Dean's office.
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