Before you go replacing it, try doing a fill factory reset.... don't select the option to restore your settings.  I think you downloaded a junk app that is messing with the WiFi.

After the reset, go to Google Play and get the updates for all the stock apps.  Probably takes about 10 minutes or so.

After all the updates are downloaded, try surfing the net, watching YouTube,  check gmail, etc.... see if the WiFi problem persists.  If everything is fine, then you probably downloaded a bad app before. 

When reinstalling apps, just do it 1 at a time so you can isolate and figure out which app(s) are causing problems w/ WiFi.  I would also be careful about letting your daughter just have free reign with downloading apps...

Also, you may have something in the house that is simply interfering with the work signal (e.g. household appliance... is the microwave or cordless phone on when you notice WiFi problems?). Could also be that there are too many access points using the same wifi channel (e.g. you and 3 of your neighbors's wifi in range are all using channel 6 ...) .... that could cause some issues with it coming in/out....

Where can I can one of those HDMI WiFi dongles?

Poetic Slimline is perfect.   Its incredible thin and isnbasiczlly like the cover for the iPad.   It has a magnet inside that turns screen on off when you open or close the cover.  The cover has a microfiber on the inside that protects and cleans the screen.  The cover can also fold into a stand for viewing.... best value at $15 on amazon.

Never ceases to amaze me that people buy a Nexus device for the vanilla android and interface, only to root it for Apex or another similar launcher....

In get rooting for some of the tools such as USB, but I've got tons of cloud storage on Google Drive (5GB) and SkyDrive(25GB).  All my music and movies are stored on Google Play, and all my photos are stored on Google+..... 

I have the 8GB Nexus 7.  If I don't want to use a new launcher and have no need for more storage.... is there a reason for me to root? Not being sarcastic ... just trying to figure out if there is maybe something  I am missing out in?

First, change your Google password immediately, along with any passwords on other services that you may have associated with the tablet (e.g. bank app, corporate email, Wallet, Facebook, etc.).  Use 2-step validation when you can.

Second, you will only be able to find it if you had location services on.  When you first setup the tablet, it asked you for permission.  You could have also changed it after setup by going into the device settings.  Besides the general Google location services, your GPS will make it a lot easier to locate if it was turned on at the time you left it.

Third, check your location history on Google dashboard.  If the WiFi is on, and you had the proper settings for reporting location history on the tablet, you might be able to determine the location of the device depending on the activity on the tablet.  (E.g. someone opens Chrome, Maps or another app that is connected to your Google account that requests device location).

Next device, I advise the following:
1.  As I said above, use 2-step verification for Google and other accounts.

2. Use a PIN or a Pattern lock so that if someone steals/you lose the device, they are locked out and can't use it.

3.  Use the Encrypt data tool to protect files in your tablet should someone be able to access your device anyway.

4.  Get an app that is specifically designed to help you locate lost or stolen devices.

5.  Never let your device out of sight.  :-)