About a year ago the dentist noticed that DD1 (5) had some decay on her back two molars, DD wouldn't really let him do much to this so her put a bit of paste over the top and referred her to the children's paediatric dentist unit. Something went wrong with the referral and we never got an appointment. I kept meaning to chase it up but
other things kept getting in the way and when we went back to the dentist about 10 months later he re-referred us. Anyway he also mentioned when her rereffered us that we could try a specialist local children's dentist. We went there this week and DD had inhalation sedation so that they could try and fill the tooth. She was a star they had to drill it out and everything and put temporary filling in BUT they said the decay is too deep (near the nerve on one tooth) and she needs to go into hospital for a tooth extraction of at least one of the teeth under general anaesthetic 
I am mortified and can't believe it has come to this for poor DD, she is only 5. I totally realise it is my fault for not chasing up the appointment and if we had caught this earlier this would have been avoided and feel terrible about this. But I still just don't understand why she has such badly decaying teeth (the dentist this week said there is decay on an upper molar on the same side). I genuinely don't think she has more sugar than the next child. I was very careful PFB until she was 2 and she only had water, no sweets etc, unfortunately at 2 she started refusing water, and I foolishly let her have well diluted squash. She does have biscuits and chocolate but not all the time. Pudding is fruit or yoghurt unless it is Sunday lunch when we may have proper pudding. I know this is a wake up call and I don't want the same to happen to DD2, so I have now said it is water or milk at home and juice/ squash is a treat if they go to a party or we go out. But I don't really know what else I should do. We have always brushed her teeth and she has always loved milk and drunk loads of the stuff but this doesn't seem to have made her teeth any stronger.
Why has this happened? 