Shi is really a stand up brawler. If you just stand there and try to duke it out with her, you are most likely going to fail and fail miserably. She's a quick character and very hard to hit, and she's very good at using her weapon, the Naginata.
But Naginata is also her weakness. Should Shi become disarmed, she would need to quickly recover that weapon to stand any chance of surviving combat. But, as I said, she's quick and can easily recover her weapon. Also, she needs to avoid taking any critical hits because just one crit can severely weaken her.
She is incredibly adept at hitting with her weapon. This is why most player should refuse to duke it out with her. Her power strikes will cause heavy damage when she hits, but it's her thrusts that will literally whittle you down as she will hit you more often with these.
As for non-weapon attacks, go with her kicks. They may not cause the most damage, but she's good at lining them up. Avoid using desperate swing, as she just can't hit for squat with it.
Shi is incredibly deadly with the smaller lightweight fighters, but she needs to be very careful with the powerhouses that can easily cause her critical damage. The last thing Shi needs is to have her weapon broken, and even when she can't do "red" or "blue", she will find it hard to fight back.
Over all, I think Shi is best suited for those that have played the game for some time. When she has her weapon, she hits often, so that makes her an easy character to play. But when she loses attacks or, heaven forbid, her weapon, she become very difficult. But no matter what, she's tough.