Hello, as for where to host the birthday party, I would suggest breaking out the local phone book. Check to see if you have a local complex in your area. Where I live we have a complex that you put a deposit of $25 down, when you reserve it. And it has the chairs, table, and kitchen. All you do is clean up your mess and put everything back to how you found it and when the advisor do a check later, they refund you the full amount back.
As for party ideas, since you already plan on the princess theme, I would get some construction paper in your DD favorite color/s and make handmade invites with some glitter paint pens, etc. Fold the paper in half and make a crown and cut it out or a heel. Then add all the information to it and get some plain evelopes to put them in and add some stickers to it. I would also suggest asking the girls to come dressed as princesses, excluding the crown. You can buy these foam crown shaped visor hats at walmart for cheap. Get enough for the amount of guest that you know are coming. Get a glitter paint pen or sticker foam letters and add the names of the guest to each crown for the party hat/favor. I think they even sell some foam purse crafts as well. That could be what you do as a actvity and it would make a nice party favor. Go to a dollar store and pick up a few of the makeup kits to add to the purses. Some ringpops. Get some big beads and yarn and make braclets. Make a pin the glass sliper on the foot game.
What ever and where ever you decide for the party will be fun. They will enjoy being together playing. Take lots of pictures and make a princess scrapbook with your DD a few days later. Best wishes and loads of fun.
Also here is a link for how to castel cake:
http://familyfun.go.com/utilities/global/feature/fftv-arc...