I think it depends on the child. I had my 2 with me for a while while I was in labour, they weren't there for the birth though. DS (5 at the time) totally freaked out and couldn't deal with it at all while DD (3) was fine. If you think your DD could handle it by all means have her there. It's your labour and your decision - the hospital will just have to 'deal' with whatever decision you make.