Can prepositions be 'subordinators'?

[For her to lose the election] would make me very happy.

Yes to your first question. The subject of the bracketed infinitival subject clause is "her", whose referent (antecedent) would have been mentioned earlier in the discourse.

Yes and no to your second question. Preposition and subordinator are different word classes (parts of speech) so a word can't be both at the same time.

You need to distinguish word class and function. In your example "for" belongs to the word class subordinator (not prep) and its function is marker.

Note: the history of "for" goes back to the preposition "for", but this "for" behaves as a clause subordinator. It does for infinitival clauses with a subject what the subordinator "that" does for declarative content clauses.