1) She is the best of all.
2) She is the best of the two.
3) She is the better of the two.
4) She is the best.
5) She is best.
Which are grammatically correct ?
Only (2) is clearly incorrect - to the purist, at least. Some people would say it. Whether or not the others are 'correct' would depend on context. They are all acceptable grammatically.
Context is always important; labelling is rarely important.