Have you contacted a medical professional about this? It is highly contageous, even without direct contact, so be care please so that you don't get it or spread it to someone else.
You should definitely take her in for a professional treatment for this, espeically since she is so young and it is such a severe case. You will be able to discuss options with your doctor. If you already have been to one and this is the only remedy you've been given, I would advise to see someone else.
Here is a link to possible treatments, which you will not be able to do on your own.
Call for an appointment with your health care provider if you have symptoms suggestive of molluscum contagiosum. Also call for an appointment with your health care provider if lesions persist or spread, or if new symptoms appear.
http://www.nlm.nih.gov/medlineplus/ency/ar
ticle/000826.htm#Treatment