Okay, this is a long answer, but there are lots of causes of parts of our hair puffing, so this should cover most of the reasons.

I'm not sure if your child's hair is like mine, but I have a bunch of different sized curls all over my head. At the top and the middle of my head, my curls are much much smaller and tighter than anywhere else.

Because of this, when I separate my curls to define them, I have to make the ones in this area much much smaller than anywhere else. If I don't they puff up and then mat. Sometimes I put just 20 strands of hair per curl or so. The way I can tell is when I'm smoothing each curl, if I smooth it, and it pops apart, then I know that's really two curls (or more) that I was trying to meld into one curl. So I divide it again until each curl I smooth stays together. So my first suggestion would be to make more, but much smaller curls in a section, especially if this is where her curliest hair lives.

A couple other suggestions:
*You might not be using enough conditioner. I really slather the conditioner into my hair. When you are combing in the conditioner, it will foam up if you are using enough of it to do the job. By the time you are done, and finish defining her curls, it vanishes. On the rare occasions it doesn't, just dab a little water on those spots and wipe it away.

*It does matter what kind of conditioner you use. Some can be too light, and some can get crunchy or sticky or build up in your hair. I've had the best results with the conditioners I mention on the site. If the conditioner is too light, it just evaporates like it was never there, instead of doing the job you need it to do.

*Apply LOTS of one of the conditioners I recommend. It's important to use the right conditioners. Some conditioners are way too light. It's almost like trying to use water--it just evaporates, leaving her hair defenseless. Believe me. If her hair is anything like mine, you need the real stuff to keep her curls calm (without being greasy, sticky or crunchy). The type of conditioner used is vital, but not in that it-has-to-cost-a-fortune way. Actually, the cheaper drugstore brands work best. Other brands are too light and just evaporate away, too greasy, or build up with film-formers and get sticky or crunchy.

*For the conditioner to set and and keep her curls nicely clumped, there are several ways to define her curls when they are very wet and with the conditioner in them:
You can define her hair either by running your fingers through it a few times to release her curls (if her curls are loose enough—my curls won't let me do this option),

Or you can take each little curl and twirl each one around your fingers (if she has tighter curls), making lots of little Shirley Temple curls (you can check out how Aja is doing this to her hair for ideas).

Or you can define your hair by taking each curl you see wanting to form, and smooth each one between your fingers by running your hand down it (the method I use).

*Never ever brush, comb, pick, or fingercomb her hair once you have set her curls. Once you smooth a curl, that's it. Leave it totally alone. Curls need time to incubate while they dry. If you finger comb her curls, they will frizz up. That's just what they do. Pulling apart our curls makes it frizz. There is no way around this one. I think this is one of our biggest fuzz-causers. Do not brush, comb, or finger comb her hair again until you wash it, and have it soaking wet with conditioner again.

Once curls dry, they set, so they're pretty solid, and then you can pull them back into braids or twists when she sleeps to protect them.

*At night, after her hair dries, maybe put it in a couple braids or buns (or even four of them, two per side, one near the top, one closer to the bottom) to keep it smooth while she sleeps, if it's long enough. This also works in a big way to "relax" our curls. This also keeps her hair from tangling and getting all fuzzy and matted up.

*In the morning, just smooth a little water and a little more of the recommended conditioners over her hair to refresh her curls. You can smooth over any frizzies. This will get her curls to bounce right back when they dry. No finger combing, brushing, combing or picking, though. Combing=frizz.

Just so you know, in the morning, after unbraiding, it might look like all her curls are gone. It isn't true. After you smooth them with water and conditioner (so they are just damp only), by the time they dry, her curls will be back and refreshed. You can also go over any of your little Shirley temple twists that got fuzzy, smashed or untwisted while you slept, and retwist them with water and conditioner.

It takes me about 2 hours to do this process, once a week (or one hour if I do it twice a week), but that's all I have to do with my hair all week. I let my hair dry the rest of the day after that. Then I braid it at night to keep the curls smooth. The braid also helps stretch out my curls. This technique keeps my curls nice and clumped together, and I can even get rained on and my hair doesn't puff. All I do after that is smooth my fuzzies every morning with a little water and the same conditioner. The only product I leave in my hair is the conditioner. I don't use gels, styling lotions or deep conditioners. This will simplify your life.

It's wonderful that you are wanting to help your daughter with her hair! That will mean so much to her as she gets older.