Hi Sunflower,
Could be chicken pox -- it's hard to say without actually seeing the rash. There are a lot of viral illnesses that begin with what's called a febrile prodrome. After the fever breaks, the rash appears within 3 - 7 days. A good example of this is Parvovirus, also known as Fifth Disease or Slap Cheek. The Parvovirus rash looks flat and lacy, though, and cheeks are bright red usually, so it's unlikely from your description that she has Parvo. In general, the Varicella rash appears predominantly on the trunk and looks like small raised bites with a blistered-looking top. It's quite itchy. Within a couple of days, the blisters will look oozy and then crust over within 5 - 7 days. New papules can continue to arise over the course of 1 to several weeks. You really should take your daughter to a doctor for a proper diagnosis, though. If you do, warn the office that you suspect chicken pox so that they can arrange for keeping your daughter separated from other children while waiting. (Our doctor came outside to examine our son!)
If you daughter really does have chicken pox, it's rare to have complications at her age and a great time to get the disease over with. The important thing is to keep her from scratching the papules, since that would put her at risk for infection (we all carry quite a lot of Staph on our skin). You can let her "paint" her owies with a paste made of baking soda and water, or calymine lotion to ease the itching. If it's really bad, your doctor might want to prescribe a mild antihistamine or antipruritic to help. You also want to watch for development of the rash in the eyes, nose, and mouth, which can make her very uncomfortable and can pose other risks. Like I said, in a child her age, those types of complications are rare, as is the possibility of varicellar pneumonia. While you should keep an eye out for development of such things, I wouldn't stress over it -- just get medical attention ASAP if complications do arise.
And yes, whatever she has, she's contagious -- such is the way with viruses. Unfortunately, she has been contagious since before the first symptoms appeared (fever and vomiting), so there's not much you can do now, and she will continue to be contagious until the last papule scabs over. Your two older kids should be protected by their vaccination, especially if they've had the Varicella booster, although exposure can, very rarely, trigger a bout of shingles (Herpes zoster), which can be very painful. Fortunately, that's highly unlikely. If neither you nor your husband have every had chicken pox and your daughter is diagnosed with the disease, you are at definite risk and I can tell you from both medical and personal experience that chicken pox as an adult is NOT fun (plus, there's a much greater risk of complications, although they're still rare). Your doctor may want to consider early administration of zovirax if you or your husband start to show symptoms. It can significantly reduce the intensity of the disease and potentially shorten its duration.
Our son got chicken pox at age 2 (19 years ago now!). A friend of his developed it at age 3 (and again at age 4!). Even though it's most common in 5 - 10 year olds, that really only has to do with the fact that those age groups are in close proximity in school. It's less common in older children because they've either been vaccinated or have already had the disease, and in younger children because they're usually in a lower density in the daycare setting. When my son was little, it was quite common to have chicken pox parties. As soon as any of us moms heard of a child with the disease, we arranged play dates, hoping to get the think over with as early as possible. By the time our daughter started elementary school in 1998, most children had been vaccinated and it was rare to find a case of chicken pox. We decided to get her vaccinated in the first grade, since we didn't want her to miss school for 2 or more weeks should she actually get the disease. As big a proponent as I am of vaccination, this is the one vaccine that I was, and still am, on the fence about. Chicken pox is such a mild disease that I think it's better to gain natural immunity to it, although there is the risk of Shingles later in life, which is NOT a mild disease. I've always seen vaccination against chicken pox as more of a convenience than a necessity.
I hope, whatever the illness is, your daughter recovers quickly!