"American political norms" have shifted tremendously over the last 30 years. I am of the opinion that the Overton Window has shifted towards the right. We can probably argue all day why/how that happened, but the bottom line is that Reagan would be pretty center... even perhaps slightly liberal on some issues (like immigration) in today's politics.
A tea party person considers Hillary Clinton liberal.
A liberal/moderate person considers Hillary Clinton center.
Mainstream news doesn't really make any fine grained distinctions other than blue/red. So yeah, Hillary is lumped into the 'blue' category, but that is just an arbitrary bucket. In terms of the history of political policies in this country, Hillary is pretty middle of the road. Just like her husband.
I'm sure that Hillary/Bill would have had more liberal policies if they thought they could, but they both seem to be pragmatists and not idealists when it comes to actual actions, not speeches.