Some favorites of ours:

Bill Peet's picture books
Blueberries for Sal and other Robert McCloskey books
James Marshall's fairy tale retellings, and George and Martha by Marshall
Frog and Toad, and other easy readers by Arnold Lobel
The Story of Ferdinand—Munro Leaf and Robert Lawson
Millions of Cats—Wanda Gag
The Little Red Lighthouse and the Great Gray Bridge--Hildegarde H. Swift
The Country Bunny and the Little Gold Shoes—DuBose Heyward
Roxaboxen—Barbara Cooney
Miss Rumphius—Barbara Cooney
Rosemary Wells' picture books (watch out for knock-offs based on TV series)
Kevin Henkes' picture books
Angus and the Ducks (and sequels)—Marjorie Flack
Stellaluna—Janell Cannon
Verdi—Janell Cannon
Leo Lionni's picture books
Some Dogs Do (can be read as a gifted theme)--Jez Alborough