Viz the learning to play by ear and working a tune out in the wrong key comment. That's a problem for note-readers. Once you have a decent ear you'll notice you're in the wrong key and someone with experience in picking up/working out tunes will manage to transpose it simply by 'working it out on the fly'. Admittedly this daughter would probably need to get good at the whole aural side of things but that's just a question of experience and practice. I do it often enough (with songs anyway, transposing reels on the fly is rather tougher, though I'm sure there are better musicians out there who can do it) so I'm sure most other people could if they got used to the idea.

Speaking as a fiddle player, I'm quite glad I stuck with the classical teachers for as long as I did, despite not always liking the music.   They taught me good technique and I didn't end up only being truly comfortable in one or two keys. (Yes I know, good folk musicians can be comfortable in all sorts of keys and modes etc but you can't deny there are some people who seem to get stuck.) Having said that, I definitely wouldn't have sounded like a folk fiddler if I had only played classical music. It's practise that makes perfect and its hard to keep practising stuff you don't like.