Well, you can't get a digital camera with the VHS format. You can get MiniDV or Digial8, however.
I would reccommend a MiniDV camera. The format is used all over the place and you can just firewire it into your home computer and she can edit the stuff she's shot. You can do it with Digital8, but MiniDV is a better format. I'm not up on the consumer models, but I'm sure someone can help you find one. Canon and Sony are a couple of good brands, however.
"Editing is 90% of filmmaking."
- Martin Scorcese
Edit: Also, in the way of DV cameras, you generally get what you pay for. If your daughter is serious about filmmaking get her the best model you can afford because it will last her a long time and she will be able to make quality stuff.