Maybe she’s laughing so hard that it’s 苦しい. I feel like I’ve heard it used that way before, but I’m not sure.
Your understanding is right. Jisho shows alternate spellings, one of which is 散売り. The kanji 散 means “scattered”. Apparently ばら as a word by itself can also mean “loose articles (not packaged with other things); bulk items; individual items”, so I think that explains the meaning here.