Decision making dilemma regarding my house, my child and and pet's happiness: please help!

A few weeks ago I asked Fluther about a betta fish that someone gave my almost 4 year old daughter. I learned that betta fish need some heat but otherwise are fairly hardy fish. My daughter’s tank is ½ gallon. It’s quite small and I feel the fish is somewhat sluggish due to no heat. It’s ok now but I feel I can’t open the window because the house will really get chilly and I don’t want the fish to suffer.

I went to Walmart and bought a 5 gallon tank with a filter and light, and a heater. I also bought spring water and new gravel, and was going to set this all up today. When I took the tank out of the box, it’s quite large for a small fish. The bedside table I was going to put it on would have no room for my lamp or much else. However, to put it on the other available horizontal surface would make it harder for my daughter to see and feed, thus reducing her interaction and possible enjoyment of the fish.

Do I:
1. keep the fish in the small tank and have him possibly suffer?
Then use the large tank for all new fish? That could be a fun hobby or it could be more pets and mess that I don’t need.
Or I could return the tank to Walmart and forget the new fish idea totally.

2. put the fish in the large tank which would minimize my daughter’s interaction with it but the fish would probably be happier.

I was all ready to set the new tank up today, now am confused and need some decision making advice. Help!