My dd is 2.5 and in my eyes pretty smart. Her vocabulary is very good. She had talked in sentences for months and speaks like an adult. She has LOVED since she was a tiny baby… we have always read to her. Last night I read to her for 45 min and I think we went through 12 books. She can sing the alphabet and reconized some letters. She can count to twenty and count on her hand and reconize some numbers. I’m wanting to improved on all of this quite a bit. Should I wait to try her on sight words after she really get all the other stuff down? How to I go about teaching her to read??? Any tips? LittleReader, Marshmellow math, starfall, abcMouse, LeapFrog videos or magnets? As much as she loves to pretend to read and be read to I think she would love to learn to really read.
Download the Little Reader two week trial. It will help her learn 3,000 words in the course of a year, more than any other program out there, including tons of CVC words (cat, rat, sat, mat, etc) to help her solidify phonetic rules. This is hands down my favorite and it’s the most versatile. We still use this program almost 2 years later, now to teach foreign languages since my kids have mastered the program in english. They still love to watch the stories and fables tho. 
I also like LeapFrog’s Letter Factory as a quick and easy way to learn letter sounds, they sell some packs on amazon that include the flashcards or you can download them here. http://projectsbyjess.blogspot.com/2010/09/leap-frog-letter-factory-flash-cards.html A friend of mine’s 24 month old learned his letter sounds in 2 weeks using some flashcard reinforcement and watching the videos. Totally easy and fun!
Yep little reader will be perfect for you. It will do all you need to do and with little effort to you. It will teach her how to read! It is very comprehensive, worth the money. If you follow it you will not need to stress about if you are doing it right or how!
There is no reason to wait to learn sight words. Use whatever fun method you can think up to teach them. Also use star fall to teach those letter sounds. It’s very child friendly they seem to really enjoy it. Some fridge magnets will be useful for years, the leapfrog ones are lovely, get two sets of lower case letters or you will never have enough to make the words you want! Lol
As for math lots of mums here love marshmallow math, from what I have read it would be a great place to start and lot of fun for you both.
Other resources to consider:
Starfall.com
readingeggs.com - with you doing the mousing, my son is 2.5 and we’ve been doing it for a while he’s on map three with no problem. There is also a free trial, look around online for the 5 week free trial code as opposed to the 2 week.
readingbear.com - very phonetic based
Bob books
And definitely letter factory, the easiest way to solidify the letter sounds
I would definitely get Little Reader at this stage - and I would probably not only use the curriculum with a 2.5 year old - I would make personalised categories for her. This was the age my first DD really enjoyed it a lot. As for letter sounds - you can use a programme and they do work well, but I would still follow up with showing her letters everywhere - on her cereal boxes, in the shops, on adverts, on the covers of her books - just keep showing her where words and letters are found so she will know what a big world reading is opening up to her. You can also at this age start teaching her left to right and top to bottom if she does not know it - run your fingers under the text of the books you are reading to her. And finally once she knows her letters I would start reading bear which teaches blending.
Basically I believe you cannot overdo it with reading instruction unless it takes too long at a time - basically I mean that the MORE resources you use at this age the better (and this is NOT the case at older ages where they can become confused) So as long as your DD is enjoying it keep going. If your DD is very keen on a particular book you could teach her all the sight words for the first page and then let her read it (make sure the font in the book is big though else she may struggle)
Good luck and enjoy the journey.
thanks for the link - I finally printed and laminated these this evening and they were a big hit!