Here's where having three little girls comes in handy. My now 4 year old is a little princess and dresses up almost every day. I shortened my old formals and they became her "new" princess dresses. It is so easy to do even if you don't have a sewing machine. All you need to do is get some stitch witchery from Walmart and hem the bottom to fit. So simple and your little princess will be so delighted.
If you no longer have any laying around this is the perfect chance to ask your friends if they want to donate any of their old formals to you. Check out garage sales too, you may get lucky and find a few for a couple of bucks. I'd rather do that then spend $20 or more on a single dress-up dress that is poorly made. Everything has to make it through three girls.