Oh Hon it sound like not telling her is upsetting you. For this I am sorry.
I am firmly in the tell her group.
I can only really guide you with the direction my IL'S and we took.
Both my dh and ds have a strong sense of who they are. They both know the truth and were told as soon as they were old enough to understand. For each child this time is different. To be honest I was the one with reservations on telling ds the truth. But for us it has worked out.
Ds has said to me in the past he's pleased to have a Dad that chose to be in his life.
I just asked him if this is still how he feels he said yes and that dh is his Dad and his bio dosn't count as he has not been in his life since he was a baby and that he dosn't even remember him.
If you do tell her;
I'm sure your dd will have plenty of questions for you, as long as your open and honest I don't think you'll have any problems. Don't forget to mention to her that her Dad has chosen her to be his daughter. (Very important I feel) He chose her to be his daughter, he could have chosen any little girl but he chose her. Ds said this makes him happy knowing that his Dad chose him.
You have my Love and support with this delicate issue. No matter which road you take.