M.N.
For software- I highly recommend Jump Start or Disney ( specifically Winnie the Pooh ). My daughter has been using them since the age of 3 and is quite proficient with them now. You can also find free games on these web sites.
http://home.disney.go.com/games/
http://www.fisher-price.com/fp.aspx?st=10&e=gamesLand...
http://www.sesameworkshop.org/sesamestreet/?scrollerId=games
http://www.browsewithme.com/topsites/toddler/