My daughter's hair was exactly like that at that age. She also wanted it long, but she didn't want me to do anything to it, not even comb it, so I ended up getting it cut in a short bob. That helped a lot. I also had to spray detangler on it every day before combing.
She is eight now, and she is finally interested in having nice hair, so it's getting easier. It is still fairly short, but she is letting it grow out. It has gotten a little thicker, too. Recently I bought her a satin sleep bonnet, and that has helped. She used to wake up with this horrible rat's nest sticking straight out of the back of her head, but if she wears the bonnet all night she wakes up with her hair still looking pretty nice.
I have fine, thin, wavy hair, too, and we both just started trying out CG a few weeks ago. Up until recently I used very little conditioner on my hair and none on my daughter's, because everything I've read says not to use much on fine, thin hair. But since reading Curly Girl I have been experimenting with using more and more conditioner, and our hair is looking curlier and fuller than before. My hair at the nape of my neck was always so tangled, and in the book she says to put some conditioner there. I never would have put conditioner that close to my scalp, but I started doing it, and now I don't get tangled there.
What do you wash her hair with? With sulfate shampoos I had to wash at least every other day because my scalp was so oily, but that was too hard on the length of my hair, so it was dry. Since I switched to sulfate free, I'm finding that I can go 2-3 days between washes. So far co-washing hasn't worked for me; my hair feels clean but is really soft and limp. Fine, thin hair is tricky because if it's dirty it gets really limp, but washing too often can dry it out and make it flyaway and frizzy. I guess my point is that I don't know abpout washing every day. For me, anyway, even gentle shampoo every day would dry it out, but co-washing every day would make it a limp mess (I think, based on my three attempts).
I don't know if I've been helpful at all. I feel your pain! I have threatened more than once to shave my daughter's head!