It's a bit late to re-think, but...different dentists can look at the same tooth and the same child and have VASTLY different plans of action.
We checked out one pediatric dentist, because our son had two teeth grow in brown, then started decaying into nubs. He had all sorts of rude things to say about the family's diet, until he looked in DS's mouth and realized it actually WAS just those two teeth (diet would cause more rampant problems), and one cavity.
However, he's scared of tiny children's reactions, and said that he would require general anesthetic for 2 hours or more, he would pull those two teeth, and probably pull the two sharing the cavity. And put fillings into tiny spots elsewhere (he just called them spots, not even cavities).
We decided he was OUT of his mind, and went through the process of finding another.
This fellow had a private room for little ones or screamers, with a TV in the ceiling playing Finding Nemo. He checked DS with DS's lower half on his lap, and DS's upper half on DH's lap while they sat knee to knee (I had figured out after all those dentist visits that DS was much better off if I am in the waiting room!). On the second visit, he did the big filling with NOTHING. No novo/lidocaine, no gas, NOTHING.
On the third visit, DS *ran* into the treatment room with a big smile, got up on the chair (rather than laps), happily got a shot or two of lidocaine, and had the two teeth pulled in a few minutes' time.
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So...treatments can vary, medications can vary. I personally would probably NOT do the crown for something like that. I have a crown for something that required it, and I HATE the dang thing. But when I had it, it only required novocaine, no sedation. I'd likely wait (I've chipped my teeth and they have never become cavities), and if time came for it, have it pulled.
This dentist either knows that your girl flips out, or he's afraid of her flipping out. If it's the latter, I'd rather go to a dentist that starts off with less rather than more (of course, I'm glad this guy isn't jumping to general anesthetic first off!).
I also don't know anything about pediatric crowns, and I don't know if they are doing a root canal first (or if that's needed?), but that might be the part for sedation; I couldn't afford the root canal so I didn't have one (600 each!), so my novocaine might have been because of that...I'm not sure.
Anyway, like I said, it's a bit late, but I always advocate going to as many dentists as it takes, until you find one with whom you agree, and aren't scared about.