I bought the Fischer Price Nativity Set this year, so that the girls could play with it and so that we could teach Talia, especially, more about the true Christmas story.
I wrapped up each of the pieces individually, and we talked about the story of Jesus' birth, piece by piece. Talia thanked us for individual pieces, and when we were done, I showed her how pushing the angel down makes the star light up & Silent Night plays. She said, reverently, "Jesus is born!" and placed Jesus, Mary, & Joseph in the stable while the music played. It was pretty cute! :)