Same rules as WowOoo here. Dd1 first went on it age 7 and still plays now age 9. I thought it was a good introduction to social networking and to learn some internet safety before the ugly question of Facebook rears it's head in a few years!
Yes I am in the same position at the OP - my daughter (6) wants to 'join' (she already plays the free one) but after reading those old posts its also made me a bit concerned. Our computer is in a purpose built office in the garden so I cant keep an eye on her ALL the time (although the advantage of this is she doesnt play on the computer v often)
Im not very 'au fait' with all these sites so when I look at it my eyes cross and I just want to fall asleep.
We never had much of a problem with it although DS was younger and had grown out of it by your DD's age. The older they are I guess the more they will understand, post friends requests, etc. Never saw anything untoward myself though.
What is the current thinking on it? I've not been on the site yet (am on my phone at the mo and will do layer) but DH did to get them passwords. However, he's a technophobe and didn't investigate it at all.