Hi, M.--
How great your daughter enjoys reading! I've been thinking about your question, and I think you've gotten some great answers.
Personally, I know some people say it doesn't matter what you read as long as you are reading to your children, but I respectfully disagree. I listened to an interview with Daniel Pinkwater a few years ago (he is the author of the "Blue Moose" children's books, and a generally brilliant and hilarious person) and he said that adults *must* like the books they are reading to their children, so they can read with sincere enthusiasm and interest. If you're trying to fake enthusiasm for a crappy book, he said, your kid will see right through it and start to suspect reading is not as much fun as everyone says. His comments changed my attitude and I no longer feel selfish in choosing children's books I love.
I think it's great is your daughter chooses some library books herself so she has a sense of autonomy with reading material, but you can add to whatever she chooses with some carefully-selected winners and you'll both have a great reading time together.
My family *loves* the book "Library Lion." I highly recommend it. Also "How to Heal a Broken Wing," which is amazingly tender and thought-provoking with terrific illustrations. "The Story about Ping" is a classic.
I often browse the Chinaberry catalog for excellent ideas--their inventory is very carefully chosen and always good.
Anything by authors David Shannon ("Alice the Fairy," "A Bad Case of Stripes," "The Rain Came Down," Too Many Toys," "Good Boy, Fergus," "How I Became a Pirate") Mo WIllems (do not miss "Knuffle Bunny," "Knuffle Bunny Too," "Don't Let the Pigeon Drive the Bus," "The Pigeon Finds a Hot Dog," and any and all of the Elephant and Piggie books--they crack us all up), Mem Fox (all winners), Peggy Rathman ("Officer Buckle and Gloria" and "Good NIght Gorilla" are classics) and Kevin Henkes ("Julius, Baby of the World," "Owen," "Chrysanthemum," "A Good Day" (this is excellent for bedtime), "Kitten's First Full Moon" (a Caldecott winner, also a lovely bedtime choice) are also terrific.
The book you *really* need though is "The Read-Aloud Handbook" by Jim Trelease. It's a work of genius, and has been published in several, always-updated editions. It is a wonderful resource, and even though you'll be able to find it at your library, it really is worth owning a copy. I received it as a baby shower gift many years ago, along with a couple of board books to read to my coming baby, and it was an incredibly thoughtful gift. The first half of the book offers tips and details about how to create skill and enthusiasm for reading in your children and why that's so important, and the second half of the book is an encyclopedia of never-fail read-aloud book suggestions for various ages. I cannot recommend this book strongly enough--besides getting lists of recommendations from your local children's librarian, "The Read-Aloud Handbook" is the very best resource for helping you find excellent books you and your daughter will both love. There are no disappointing books listed in Trelease's book.
Congrats on raising a reader! Best wishes!