My little girl is the same age as yours, and I briefly considered allowing her to be there to witness the birth of her little sister. It didn't take me very long to decide (quite strongly) against it, purely because *I* think that at that age, they're too young and don't yet have the capacity to understand why mummy's in so much pain, why the blood is no cause for panic, what those machines mummy's hooked up to are, etc... not to mention the fact that I *needed* my DH's attention focussed solely on ME, I couldn't bear it if he was constantly distracted by DD1 getting into mischief or panicking at the sight of me in pain or deciding she was hungry etc etc etc...

But, that's just my personal opinion and I have heard that lots of siblings and parents have amazing, positive experiences being present at the birth. I just didn't feel it was a good idea for *my* daughter to be there with DH and I, and she had a great sleepover with her nanny and poppy (we'd dropped her off earlier in the evening before we really knew anything was happening, so it wasn't like we woke her up in the middle of the night and dumped her at my parents' or anything) and in the morning came to see mummy and her new baby sister in hospital. We were lucky enough to go home that afternoon so the adjustment and bonding between them happened pretty much straight away.

I say if you think your daughter is up to the challenge, go for it! Just make sure you have a back-up plan in place just in case something goes wrong or your little one decides she's not happy being there in the thick of it all Good luck!