In Your Manuscript's Next Life, It Will Be Agented

On a day last May, I made up a picture book story along the lines of Miss Spider’s Sunny Patch cartoon and the Froggy books when I walked my daughter to school. She had the original concept and I asked her questions to build upon the story. I thought it was cute and when I got home I wrote it down. Subsequently, I entered the Spoonful of Stories contest by Cheerios, but alas, I didn’t final. I have since written six more stories involving these characters. Would it be improper to submit the series idea in a query?

No.

Would it be bad karma to send all of them in one envelope to live in your slush pile?

Yes. One at a time, and after your critique group has looked at them, or I would worry this is more "cute story" or "isn't my child imaginative" than it is "good writing".

Or should I just file it under, ‘great moments shared with daughter’?

Maybe. It's good to keep this in mind whatever happens. The really enjoyable parts of your job, whether author, illustrator, or editor, are the creative parts. It's worth it to wade through the rest of it in order to share the creative parts with other people, but if all you end up with is the creative parts... that's not so bad, is it? And you've earned some good karma with your kid.