Thanks all for your replies.
I started with teaching her and her older sister (9) a simple song at the weekend. Michael Finnigin (the wind blew his whiskers innigin!!) it only has 2 chords and we used the simple G. This has done the trick so far as they have both praacticed a few times.
I will see if I can get hold of the abracadabra book here in Australia.
I will also look at the web site.
Just for the record, it's not so much that I want to teach her it is more she wants to learn. Since I got my guitar for uni last year there has barely been a week go by that it does not sustain another ding! This is because she keeps trying to play it and doesn't seem to realise how big it is in relation to her little body.
Also I think it is hard to teach these kind of things to your own kids because they don't want to listen to you.
Ayway we will keep trying as long as she is interested.
The guitar we have is a nyon striing and actually has a better tone than mine! I think this is because it is about 15 years old and a reasonable quality. I think Santa may bring her her own if she keeps it up.
Thanks again