How precious are those squiggly first attempts at learning penmanship! We still have treasured samples that tiny hands penciled decades ago.
Your question is a common one, as it deals with the acquisition of small motor control. While a few children have good control and are precise in letter formation by first grade, many don't master manuscript until it's nearly time to learn cursive! Practice is the key.
If your daughter isn't discouraged and you can see that she is improving, you might wish to keep her in the workbook. However, if she is becoming discouraged, it is perfectly acceptable at her young age to allow her to form letters on a blank sheet. Better yet, she might like using a chalk or dry erase board for early practice. The keys are practice, and time for her small motor skills to mature.
However, it is still important that she learn the correct formation of letters from the beginning, so good habits are formed. In addition, the presence of lines in the workbook helps establish 'boundaries' that she will need to learn before first grade so she can complete exercises that require the use of lined paper or lined spaces in spelling and other workbooks. Thus, you might wish to go through the alphabet on the dry erase board, and then return to the lined workbook in four or five months.
May God give you both joy as you homeschool to your daughter's benefit and His glory.