http://forum.brillkids.com/little-reader/optimal-lesson-time-with-your-children-using-little-reader/msg2515/#msg2515That link should help answer some questions. I recommend showing more than just colors, and I would set the playback on random. This will add variety and keep your daughter interested. I play several categories a day, 3 times per day.
You do not need to wait for her to say the words. How old is your daughter? It may take several months for her to say the words. This link should help.
http://forum.brillkids.com/little-reader/evaluation/ I would go ahead and play other categories too, and then go back to ones previously played every once in a while.
By signs, I'm assuming you mean sign language? Here is a thread we have for sign language
http://forum.brillkids.com/general-discussion-b5/signing-with-your-child/. If you have questions about sign language that aren't addressed there, you can ask, and we will try our best to answer.
Welcome to the forums!
Nikki