Does she snap and growl at anyone else? Specifically, when you or your daughter pick her up does she squirm and snap to be let down? My first GSD would do that when he was a few months old and I didn't think anything of it at the time and would put him down, NOT the right thing to do!!! I should have held him until he was still and THEN put him down, I was only reinforcing that bad behaviour!
I would definitely continue what you are doing, especially having your daughter so involved. Along the lines of a time out, my mom had a dog that would act out from time to time and she would actually ignore him, act like he's not even in the room. This drove him crazy and his acting out got less and less, I don't know if this would work with your girls personality.
Good luck!