You got the first part of your question about right, except the proper way of doing it mathematically would be like this:
1- Since they have agreed to charge her a simple interest rate of 4% per annum, then she will pay=$,3,380 X 4%=$135.20 per year. But, because it's for 3 year, we just multiply that amount by 3, and we get: $135.20 X 3=$405.60. So that the total amount she will pay them will be: $3,380 + $405.60=$3,785.60. And that's it.
2- Remember they told her that they would charge her 4% annual interest rate
In simple interest, which means NOT componded. So, your calculations in 2 are wrong. The total amount she will owe them is the one I calculated in (1) above. And that is all there is to it.