Let $g$ be the quotient map from $M_2$ to $M_1$ (namely torus). Why $g$ induces isomorphism on $H_2$?
Also, Hatcher talks about the degree of $f$ from sphere to sphere in his book. Can it be generalized to any map between topological spaces $X$ and $Y$, if the highest homology groups of $X$ and $Y$ are $Z$? How?
It depends on the map, sometimes you will not get an isomorphism of $H_2$: For instance, suppose that $f: M_2\to M_1$ is a branched cover of degree $2$, then $$ |H_2(M_1):f_*(H_2(M_2))|=2. $$ More generally, you can realize any finite index.
See here for a geometric interpretation of degree in the smooth setting. This should answer many questions that you have. In general, one can define $n$-th degree for a map $f: X\to Y$, it is simply the index $$ |H_n(Y): f_*(H_n(X))|. $$ However, this notion is not very geometric once you leave the realm of topological $n$-manifolds (or pseudo-manifolds).