OK; I am going against the grain a bit here.
This is an old friend and so are the family and yes she could have mutual feelings for you. However: Sex, (are we allowed to use that word here) can really ruin a good friendship. Yes of course you have to raise the subject with her, because if you don't your head etc., is going to explode, but don't just dive in there at the first sign of it being a possibility. Do talk about it, privately, quietly and keep your gentleman's hat on.
I think with a friend, you can say something like: 'I had a dream about you last night and we...'
Many good friendships last a lifetime, they can be close, have the greatest trusting bonds and be places to share you most intimate secrets and fear. All without exchanging one drop of sweat. Let nature take its course and don't be afraid to fail or make mistakes, whatever direction events take the pair of you.