I would stay away from the Fancy Nancy stuff, just because I would guess a lot of people are going to be getting it and it would be easy to end up with multiple of the same books or toys. One of the things DD (4.5 yrs) has really really enjoyed are These Sticker Books that grandma got her. She has had hours of fun (really) making collages and pictures with them on plain paper. They have several themes that are all quite cheap so you could get a variety for them and not spend much. I've seen sticker books with a lot fewer stickers for 3 times the price. FWIW she has some of the magnetic dolls and hardly every plays with them, I was about to donate them to the preschool for the quiet room.
Just yesterday she made a collage of the tea party stickers (cups, treats, chairs, tables, etc.) and had her small LaLaLoopsy dolls sitting on the paper having a tea party. It was pretty cute.