First, I think you do need to respond to her message. And not because of courtesy either. If you do not not respond, she has no way of knowing you received the message. It could have easily gone astray, and she will surely try again, at least once, perhaps several times. Save yourself the trouble and answer it now.
Second, you choice of how to answer has been well addressed here. I tend to agree more with Nya and those who feel a very brief reply is the way to go. I wouldn't address your daughter in it at all. It would read more along the lines of this:
Babysitter,
It is good your life is better now, but we will not be using your services again or meeting with you. Please do not contact us ever again.
Cordially,
OP