I have a non-compliant early reader so I share your concerns. Luckily, DD loves drama so she happily reads her lines to me.

DD also insists on having subtitles on for everything including Disney music video. Watching science DVD with subtitles on was very helpful in sharpening her decoding skills.

I am planning on putting her through a solid "spelling" program like Logic of English when she is 5 or so. Right now, I'm trying to keep everything fun but your DD might be ready?