Daughter was FT student in 2023 and has a W-2 from Dept of Interior. She lives in CO but W-2 shows tax withheld for KS. Does she need to file both CO and KS returns?

She won’t get a refund from CO if nothing was withheld by that state. Filing a non resident return for KS will get her tax withheld back. You could try filing for free at the KS site. 

There's information specifically missing from your post, but inferred:

Your daughter is a CO resident.

She worked in KS.

She does not have enough income to be required to file a tax return

But she will get a refund of withholding if she does file. 

She should file a KS non resident tax return to get a refund. 

This is the general rule: The income is work state (WS) source income since it was earned there. Resident States (RS) tax all their resident's income, regardless of where earned. You will file a non-resident tax return for the WS and report the WS income. You will file a full year resident return for the RS, reporting all your income. The RS will give you a credit, or partial credit for any tax paid to the WS.

State Filing Requirements: https://ttlc.intuit.com/questions/2903200-do-i-need-to-file-a-state-return