S/O How to determine a child's reading level? Any grade 3-4 "harder" picture books?

[goldenpig]

This is a piggyback on jess_g's thread on how to determine the grade level of a book: http://windsorpeak.com/vbulletin/sho...d.php?t=431520

My question is related: how do you determine a child's reading level?

DD is 4.5 and has been reading for about a year now. I'm often surprised at the complexity of words she can read. I haven't tried to figure out what level she is reading at but have always wondered. So I found and tried a couple of these online reading assessments on this webpage:
http://homeschooling.gomilpitas.com/articles/060899.htm
I tried the first two right now with DD and they both put her at 4th grade reading level. Can that really be true? She's not even in K yet. She went all the way up to "quality" and "urge" on the first test and "realized" and "interrupted" on the second (she missed those words but got everything before it correctly). So how reliable are these tests? Is there some other more accurate way to determine your child's reading level? I've been giving her books like "Poppleton" and "Curious George" and she reads those aloud without any mistakes, but now I'm thinking they may be too easy for her? They're 2nd grade level (2.8-9) according to the Bookwizard link someone provided in the other thread. I've been reading Charlotte's Web aloud to her (we read every night--she reads a easy reader book to me, I read a chapter from a chapter book to her), but maybe I should let her read the chapter books aloud herself? She'll sit there and read Disney Storybook Collection (http://www.amazon.com/Disney-Storybo...5495938&sr=8-1) to herself, and sometimes will read some of it to me (so I know she isn't just looking at the pics but is actually reading the story), but if I give her chapter books with minimal pics and small print and lots of words on the page (like the Charlotte's Web) she doesn't want to read it out loud to me. I think the page looks too intimidating, even though she probably could read the words.

So how do I find more appropriate books for her reading ability? Are there higher grade level (grade 3-4) books that still have lots of pictures to keep her interest with bigger print/fewer words on the page so she feels more confident reading it aloud? I feel bad that I haven't really been paying too much attention to her reading level and may be giving her books that are too easy rather than challenging her a bit. When we go to the library I usually just let her pick whatever catches her eye, but I really would love to go with a list of books to look for in the future. Are there books or lists about which books are appropriate picks for each reading level? I have tried asking her teachers and the librarian for help before but they usually give me cursory answers, and the librarian just points me to the easy reader section. Thanks for your help!