Here's a thought- why not let Pallas decide for herself if she wants to go see The Phantom Menace? So I tried an experiment today where I let her watch the DVD, thinking she would quickly lose interest and that would be that. Turns out she loves loves loves the lightsaber duel between Darth Maul, Obi-wan and Qui Gonn. As well she should, that's easily the best lightsaber duel in the whole saga. (Some of the CG Clone Wars episodes have fights that rival it, actually.) She watched it many times. "I want he to fight!" she said at the part where Darth Maul is looking through his monoculars on Tatooine.
Also, she likes that "Beauvio princess" (Queen Amidala). So maybe we'll go see it. Too bad there aren't fast forward and rewind buttons in movie theatres, though, her patience might wear thin on all the Jarjar parts. I know mine will.