Theotokos means Godbearer or Mother of God.
http://en.wikipedia.org/wiki/Lutheran_Marian_theology#Mother_of_God
Yes, Mary was the mother of Jesus, the Son of God. We don’t believe she was sinless or divine though.
Some of this gets into stuff that sort of boggles the human mind. I know there is the question of how Jesus could have escaped original sin while having a fully human, sinful mother. I know there are arguments/discussions about that and it’s still sort of a mystery to me. If original sin is passed along strictly in the DNA it would be baffling.
The way I think of it is that original sin is basically separation from God - the corruption that is within us because we are alienated from God, don’t have the fellowship with God that mankind originally had in Eden. But the human nature of Jesus was intimately connected with God the Father as could be, because the human and divine natures were together in one divine human being.
My daughter is feeling better now and she’s watching my husband’s screensaver of photos, chattering away. So my mind has done about all the thinking it’s gonna get done tonight, I think. lol
Some of the divisions between denoninations are because we’re humans of finite capacity trying to understand infinity and other mysteries. I’m glad we don’t have to understand all the mysteries before we can grasp the simple truths that save us: that Jesus has paid the punishment for our sins and because our debt is paid there is nothing left to keep us out of Heaven. There we will fully know, even as we are fully known. It’s gonna be great!