K.D.
I LOVE to read, and I hope my daughter will too! So, we read every day - usually what she wants, but sometimes what I want, so I can expose her to new topics. We visit 2 different libraries every week, and I NEVER limit how many books she can bring home. I have the librarians help us find titles for subjects we're currently interested in (gardening, ballet, and camping right now). This way, she'll learn that libraries and those who work there are friendly and helpful.
At this age, she probably LOVES rhymes, so as you read rhyming words to her, show her how they're spelled similarly (best to do this with books she knows well so the flow of the story isn't interrupted).
I have labelled my house to help her with some word recognition, but I try not to force it on her. If she asks what a word is, I say it and sound it out while pointing to the letters. We also picked up a LeapFrog Word Whammer, which is a fun toy and a learning tool. I have heard of kindergarten and 1st grade teachers who can pick out which of their students have this toy - it's that good at teaching 3-letter words. The volume control is decent too.
Also, many kids enjoy learning names first - their own names, Mommy, Daddy, sibling names, favorite dolls and animals.
But, the best thing to do for your daughter is work with her current interests. If she is fascinated by letters and books and is always asking about words, then it's probably a good time to squeeze in some extra educational material. But if she's more into running around or singing loudly or taking apart the fridge, then her brain is probably growing in a different area, and maybe it would be best to encourage that for a while.