Universal is so, so easy compared to Disney. For example, my 16-page Disney/Universal planning guide for my family's recent trip had about 13 pages devoted to Disney and only about 3 for our Universal days. It's much smaller and more compact. Having the EP makes it even easier.
We stayed at RPR and my dad and sister have stayed at Cabana Bay in the past. Both are great places to stay. RPR is a beautiful hotel and you can take the boat to the parks or walk 10 minutes to the front gate of Islands of Adventure or 15 minutes to the front gate of Universal Studios. Cabana Bay only has buses to the other two parks but they are apparently very frequent, quick, and clean.
I think if you can swing it in your budget RPR would be the better choice with only one full day in the parks and four members of your party who can take full advantage of the included unlimited EP (which I believe is about $70/pp/per day as an add-on). Crowds might be a concern since you'll be there at the beginning of the holiday season, and EP would ensure you could ride most of the rides with minimal waits.
For your little one, I don't know that there's a ton in the parks for her to do, but there's more than you might expect. In Islands of Adventure, there is a whole Dr. Seuss section that is darling and has about 3-4 rides she might enjoy. You can also just walk around with her and enjoy the atmosphere and magic together, especially in the HP areas. The Ollivander's show might be good for her if she's not easily scared (it does get kind of dark in there). There are also a few play areas specifically for children: one in the Jurassic Park sections themed to an amber mine and another in Toon Lagoon themed to Popeye the Sailor Man. Pteranodon Flyers in the Jurassic Park section is also only for people with small children. Maybe a good option if she's not scared of heights. In Universal Studios there's the Woody Woodpecker playzone, and I thiiink a stage show with Barney? Besides that, I think the only rides she could do would be a couple of the 4D shows - Shrek, for example, maybe. And of course there are characters like Hello Kitty and the Simpsons roaming around - it's really easy to just go up and interact with them.
The great thing about Universal's hotels is that you can pool-hop between any of them if you are an on-site guest. So even if you stay at RPR, you and your DD2 can go relax at Cabana Bay's lazy river. There is also a Minion character breakfast at RPR, I think. I will report back if I think of anything else!