Haven't read through any of the replies, so forgive me if it's repeating anything.
Maybe she's just not ready! Most kids don't really learn to read until they're 7/8 yrs old. Of course there are exceptions. I would just let it go for now, and retry later. My first born was like that and I thought *I* was a failure because he couldn't read when he was 5
I'd just work on letters/sounds for now.