Not sure why you care so much given how young they are. Let them do what they want. Let them milk all the social justice war all they want if that is what you feel is happening. Once in high school and college, they better either have a legitimate transgender case or it will become difficult to continue the sham. Your daughter will be just fine. For now, she can just focus on her time, not necessarily winning the race.
The left has its snowflake issues but the right too is paranoid about all out men simply calling themselves a woman the night before a race, an unfounded fear that doesn’t happen in practice and wouldn’t be permitted as per IAAF rules anyway. I suppose one could technically misidentify their gender as female for a couple years or more and then milk it from there on, but who exactly are the “men” doing this? Rest assured that if men started misidentifying for profit, IAAF will change the rules to prevent it. (Women misidentifying as male is not a credible threat.)
If you think it’s unfair for cis girls in competition and missed earnings and glory, maybe think about how unfair life in general outside competition is to trans girls who just happened to be born the way they are. Why not let the trans girls have an upper hand in some aspects of society like competitive sports?