I agree with RF - if she's bringing them for this visit then she should also be bringing toys/whatever if they need entertaining. And don't feel bad about feeling shy around other people's kids - I was too but it really is different when you have your own.

Just on the books issue. I grew up in a house with zero books except my own. I have two degrees.

We have hundreds of books between DP and our book cases start at floor level. Never been a problem. DD will take them out and flick through the pages since she's been able to crawl. Has not ripped or damaged (unless you count Vegemite fingers) one of them. Personally, I think it's great that she understands that books are to be respected (ie. not damaged) but are also fun and to be played with and enjoyed. She's also partial to a trashy mag and I can take her out to a cafe and she will flick through one magazine while I have a coffee and read another.