Wow, congratulations!
I would not put keeping it with Chrome OS installed as remotely near the top option. Go check out the Chrome Store. That is all the apps you can use. Ever. It is really designed only for very basic computer users who just want to browse the Internet, play some games and check their email. I can only imagine it would be a hair-pulling experience for a developer to try to use, since it just doesn't work at that level.
As for running Ubuntu on it, even then you may find the specs don't hold up when a real OS has been installed. Chromebooks are notorious for being extremely light on specs since Chrome OS doesn't need it. If you know the specs, and it will confidently run Ubuntu and some programs you want to use, I would say go that way. But if you don't know the specs, assume they are probably circa 2005. The disk is also likely miniscule, as Chrome OS is known for using almost entirely cloud storage.
And why not give it to your sister? Because it is unlikely to really meet her needs, and may prevent others from buying her a proper laptop ("She already has one. Why get her another?"). As a college student at least, I can vouch that Windows is an absolute requirement, and it won't be long until she is probably in the same position. Papers just don't come out right using any other word processing application. The formats get messed up, some of them won't open, some work fine until you try to re-open it in Word, etc. Sadly, this is on purpose on Microsoft's part, and a big piece of every update is trying to break all of the open source or other platform alternatives (and this will only get worse as newer versions of Word become more cloud-based, thus taking the files and reverse engineering out of developer's hands). Trying to get through school with Open Office, or god help you, a Chrome app word processor, is a quick way to get an F in a picky English teacher's class. Also, as crazy as it seems now with Chrome's marketshare, some school websites are not set up to accept Chrome. There are a couple of website I use for my university that actually bring up a notification that Chrome is not supported and to use IE, and will disable the page. With a Chromebook, you would be locked out completely.
I wouldn't bother selling it, either. Chromebooks are typically cheap (usually around $200 - $400) when new, so a used one would likely not be worth the hassle to sell it.
So really, if it doesn't run Ubuntu well, I would just keep it and look at it like a large tablet with a built-in keyboard. Keep it around just for the very light stuff.
and low and behold, I placed second at the hackathon winning myself a chromebook.
