Message states: 'you may not have merge access to the master record you have chosen or you encountered other errors' and then states 'insufficient access rights on cross reference id. I checked the user access and she has CRED access on contacts (which is what she is trying to dedupe). In her role, she is on the same level as all the contact creators. She is able to dedupe records she created, but none that were created by her peers. Any help would be greatly appreciated. Thank you.
Depending on the organisation sharing settings, she may not be allowed to edit particular contact records despite have CRUD access on Contacts.
Look at Security Settings | Sharing Settings and you will see that contacts access is controlled by access to the parent. What are your sharing settings for Accounts?
If the Accounts are, say, Public Read Only then this means she can only update Contacts associated with accounts that have been shared with her. This would be accounts she owns, accounts manually shared with her, accounts owned by those beneath her in the role hierarchy, accounts she's in the team for, by sharing rules etc.