I agree you are right to stop payment on the check and I'm very glad that you took pictures. What happened also makes me angry. And....the only way that she can sue you is thru small claims court. She will have to pay to file and will lose money if you win.
I've been to small claims court when arborists that I hired to cut down dying trees also cut down the living ones. I refused to pay anything at all. In small claims the referee or judge listene to both sides of the story and decided that it was his word against mine and that he could understand how there could be a mix up. I willingly paid 1/2 the original bill. In effect we compromised. During the hearing I came to believe that 1/2 was fair. I think we shared court costs too but I'm not sure. It was 15 or so years ago.
Small Claims court is informal and usually is presided over by a professional good at reaching agreement. It is nothing at all like small claims on TV! I would not fear going there. But I also agree with other mothers who've said they doubt that she will file. If she has to bring her preschool daughter with her to clean she most likely will not be able to go to the courthouse, file papers, pay fees and then appear when summoned by the court.
If, by chance, you do receive a summons, just go. Don't pay her to keep out of court. Just in case this might happen put in writing now what happened. Describe where your daughter and hers played and what they played with. Take pictures of those areas as they usually appear and/or as they were before you left the house. If you do go to court take someone unrelated to you and if possible not a close friend to attest that the "before" pictures are an accurate portrayal of the usual appearance of these areas. It is better to be prepared and not need the preparation then to wish you had.
If you did not put in writing what you hired her to do, write down a summary of your conversation as you remember it. Be willing to admit that there may be a difference in the two of your's memories. Underline the specific tasks that you know you asked her to do and/or the ones she told you she would do.
List the price that you agreed upon. If the price was the cost per hour, list how many hours the two of you discussed that she would work. Or if you didn't agree upon a length of time state how long, based on your experience, the tasks would reasonably take (without her daughter's presence).
If at all possible make a copy of her ad on Craigs List.
Summarize the quality of her work the day before. Do not be picky. I remember when I had a housekeeper coming in weekly I felt irritated over small things that I would have done if I'd been doing the work. I can't remember what they were but I do remember a couple of years later thinking I was too picky. I didn't complain to anyone at the time either because I knew they weren't important. I just felt irritated. Because of the next day's mess it will be easy to want to criticize everything. Leave the smallish things out. Describe the big picture.
Lawyers are not allowed in small claims court. So don't worry about that part either. You don't need to lose money. The court will not order that you be reimbursed.
I know that she won't be able to sue for such a small amount in any way other than small claims court.
After you've documented everything, you might feel better because you will have done some venting, you'll feel like you have in writing what happened and don't need to go over and over it anymore. When this sort of thing happens to me I reassure myself that this was a relatively small expense and irritation to learn some good lessons. Let me share with you what I've learned over the past 50 years.
First, never hire anyone without getting references especially when you're hiring from a source such as Craig's list or the newspaper. Acutally I wouldn't hire from Craig's list. I don't know of any reliable way to check the honesty of those ads. It sounds like you entrusted her with your home without knowing anything about her. (I am confused about your statement that your husband was home. If so didn't he hear anything and didn't he check on her? If not next time even if you hire from a service ask him to keep an eye on what's happening and have him give the employee the check.
Second, put everything in writing even tho it seems untrusting or petty. List what you expect and what you'll pay and in the case of by the hour jobs include how long you expect it to take to get the job done. Both you and the person you hire signs it. A service has a contract to which they add what they are agreeing to do at what price. You both sign it and they give you a copy. This way you have legal recourse for yourself and the company has their reputation to maintain.
Then I'd recommend not paying until you have seen the results and agree that what was done is what you hired to be done. I know that leaving a check is common business practice but I will only do that if I know the person and the work that they do. I have left a check when I hired from a service because I had signed a contract that helps protect me. The service was also bonded and insured which indicates that they will reimburse me for damage done by their employees.
This seems like a whole lot of work for such a simple job as house cleaning. In reality house cleaning is not easy and many people do not know what a clean house looks like. Letting her daughter play with your daughter's toys was in itself unprofessional if you did not give her permission to do so.
I am assuming that you did not tell her that her daughter could play with your daughter's toys. I'm also aware that I probably would want to be helpful in this situation and tell her it would be OK. If you did give permission your case may be somewhat weaker especially if cleaning those areas was not part of your agreement. If you were kind and said she could, cleaning up her daughter's mess would be expected but I know mothers who do not offer to pick up or help pick up their children's messes when they've visited. Many people are unaware of common courtesies.
This "house cleaner" definately took advantage of you by bringing her daughter and then not doing the work. In addition to that she left your house in worse condition than when she arrived. I would not pay her anything, if I were you.
I also suggest that if this happened because you thought being nice is a part of getting people's help you're now aware that some people will take advantage of your willingness to trust them. Business has to be business. It's sad but true and gets more true with time.
I sometimes still do not ask enough questions and find later that I did this because I feared embarrassment. I didn't want to appear distrustful of this mechanic had worked on my cars for years and everything had been OK. He charged me $3000 for a job that if I'd known the cost I wouldn't have had the work done. I failed to tell him I didn't want to spend more than a certain amount. That was a difficult one for me. It just happened a few years ago.
So be kind to yourself. Don't rerun the situation and be upset about how you wish you'd done it differently. Stand up for yourself. Don't be bullied or frightened into paying her.
And do not ask her to come back and give her a chance to clean your house as it should be cleaned. She has already shown that she cannot be trusted. At first thought it seems like a good thing to do but it is not. She is angry. You are rightfully angry. You have not reason to continue your relationship as you would if she were a friend, relative, or regular employee. Angry people frequently get back by doing more damage. Do you want to set yourself up for the potential of another damaging experience?