myemmie, I think it's lovely that you want to do this. . .and I don't see how anyone could take offense. . .
there are probably a lot of kids' books that would give you the story. . .I don't have kids, though, so I can't recommend any particular one. . .
boc can probably give you a complete story, but in a major nutshell, when the Jews recaptured the temple after it had been taken over and desecrated, they wanted to rekindle the eternal flame that burned consecrated oil. . .there was only enough oil to last one night. . .and the closest place to get more was a 4-day journey away - and, of course, 4 days back. . .but they said we will go and get the oil, and in the meantime, we will burn the little that we have. . .God will understand. . .so they sent someone after the oil, and re-lit the lamp. . .and the oil burned for 8 days, until more arrived. . .
that's why it's celebrated for 8 days. . .on the first day, we light one candle (there is a second candle used to light the first, but that candle - the shamas - doesn't count); on the second day, we light two candles, etc.
traditionally, children receive gifts of "gelt" or money. . .sometimes real money, sometimes the chocolate coins covered in gold foil, or both. . .they play with the tops called dreidles. . .it was only after WWII that it became an "alternative to Christmas" so the kids wouldn't feel left out - and the merchants could increase sales. . .
I can't imagine anyone taking offense at your wanting to learn and teach your daughter about the holiday. . .if you have a temple near you, you could call and ask if there is a celebration planned. . .I'm sure you would be more than welcome. . .
as for the spelling, there are about 6 different ways I've seen. . .they are all an attempt to indicate the gutteral throat-clearing sound that Hebrew has that English doesn't. . .