GO SOMEWHERE ELSE.

Hun, this is what I do for a job... and have done now for 16yrs... what they're asking is absolutely wrong, wrong, wrong... at this age, its all about being comfortable with themselves, in a group AND ESPECIALLY with the teacher - only then will they relax enough to listen to a rhythm... and thats ALL you're expecting at this point in time.

I teach preschool aged children... and have done big sized groups, and smaller sized groups.
The MOST important thing you must know to be able to work with little people is that they are all DIFFERENT.

The strategy working with one child will be different to the next, and then the next, and then the next.. and so on.

Obviously, there are basic rules about the care of instruments, etc - but they have to be in sync with the fact that they are still only babies

I have some children that want to crawl all over me and some children that want to sit far away in the corner.. you have to be flexible enough to do what works with the individual child.. and build on that.

My suggestion (if I were the teacher there) would be to have you sit with your child in your lap and play the instrument together... I'm not sure about why they have this policy, but who am I to question I guess??

There are MANY wonderful programs around for early introduction to music for little ones... my advice would be to try out a new one.

Your little one may only be 2 and a half, but confidence with any adult in a teaching position is imperitive as early as possible.. if this scars her now to have an impact to make her hesitant, you may find that she will carry that through to any tuition later down the track.
If she does private piano lessons etc later on, that can be a real worry

PLEASE feel free to PM me if you want to chat further