I will use this opportunity to teach her about capitalism- by sending home a newspaper everyday for several weeks, I'm sure they are hoping parents will want to subscribe once the Olympics are over. Should I also tell her about how much of the Olympics is linked to corporate sponsorship and consumerism?

Do I tell her about how many social programs were cut to fund these games, which were estimated to cost $6 billion. And about how this money is then given to companies who build the infrastructure to support the games instead of being put back into the community to help people.
Or about the environmental devastation that has occurred, such as in building a large highway from Vancouver to Whistler which is not needed after the games are over.

Or about the lack of treaties with aboriginal communities which was entirely illegal, and means that the Olympics are being held on stolen land?

Can I tell her about the criminalization of the poor, where Project Civil City was passed because of the games, making it illegal to beg for money or sleep outdoors, and is being enforced during the games by the largest police force ever in Canada.

As a former athlete, I used to dream of going to the Olympics. I love the idea of people becoming great at their sport, and coming together in celebration of this passion. I do not consider myself entirely anti-olympics, and I hope the protests do not affect the athletes too much. But, there are a few aspects of the games that I am not as happy with, and I think it is important that they are discussed throughout the games.
When I think about it, I find the concept of nationalism kind of silly. I am cheering for this person (but not that person) because the first was born in a geographical location that is politically defined as being the same country as I happen to reside in. That really doesn't make sense to me... rallying behind the maple leaf (or various other symbols). I think we should be rallying behind the athletes, not locations that are attached to them to make them a guaranteed fan base. One particular athlete representing Canada used to compete for the American team until he was kicked off for repeated drug problems, then was asked to compete here because he had dual citizenship. I'm not saying that we should not cheer for him, just trying to point out how arbitrary these relations are.
Another note is the imperialism that is used when defining what is and what is not a sport. I'm not as informed on this as I would like to be, but I am pretty sure most Olympic sports were developed in the western world. Also, the arbitrary nature of what is considered worthy of being an Olympic sport is shown in the battle that female ski jumpers went through over the past decade in trying to be a part of the games, which, unfortunately, did not work yet again, even though a woman holds the record for longest jump at the course they will be using.
As for my daughter's assignment, I am going to watch the Olympics with her and we will read the newspaper together. We are going to cheer on the athletes while I try to teach her about critical thinking. Together, I suspect we will enjoy the artistry that comes together as we see so many people dedicated to what I hope is a passion for their sport. I do need to use this as a teaching opportunity, I just have yet to decide to what extent.