'I do understand' is emphatic, you might say that if someone told you you didn't undesrstand something and you wanted to stress that you in fact did understand it. 'can understand' is pretty much interchangeable with 'understand' except that there's maybe a tiny little bit more ephasis on your ability to understand it as opposed to simply stating that you understand something. So perhaps you would use it if someone was explaining their situation to you and why they acted/felt the way they did, then you might say, 'yeah I can understand that', meaning that you can identify with them
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