I don't really have answers to your questions but I do have my own thoughts/feelings on the topic! I have a 2 1/2....well, almost 3 year old son myself and he knows the word "Jesus", knows who Jesus is in relation to some stories we read him, knows that we pray every night and talk to Jesus (i think that doing that with children is important from a very early age, so that they undrstand that Jesus is someone who is alive and present in their lives), and I tell him often that Jesus loves him and that Jesus is his best friend. He "gets" it to the extent that he hears it regularly and can repeat it, sort of. He will finish my sentences about Jesus dying on the cross to save us from our sins, but I know he has no clue what a cross means, what dying means, what sins are, etc. I just keep things really basic and simple right now. I have no idea who or what Jesus is to him in his head, when it comes right down to it! I can only imagine what he thinks about me talking to him about what must be to him an imaginary person!!
My thinking is that I teach him all I can and don't worry myself at all about how much he understands at this point. I don't believe that babies or very young children, or for that matter, ANYONE (mentally challenged persons, etc) who is incapable of fully understanding on an intellectual level who God/Jesus is and what it means to accept Him as their personal Saviour NEED to understand the way we might think to be saved. I think that God is a fairer judge than we could possibly imagine and He knows what is in everyone's hearts and judges accordingly. I'm sure the most simple soul who to us doesn't seem to have a clue what it takes to be saved will be judged with the utmost compassion by God. I KNOW that if my ds were to die anytime soon, or my dd who's 16 months old for that matter, that he/she would be going to heaven....not because they are capable of understanding what they need for salvation on an intellectual level like we are, or have stated that they have accepted Jesus into their hearts, but simply because I know that God is fair and God is love, and He (IMO) would not judge them for something they can't help. So, I guess what I'm saying is that I dont think a toddler or preschooler NEEDS to be *saved* the way we understand it....I mean, yes, everyone needs Jesus, but I don't think a baby or toddler who has virtually no understanding of who Jesus is and what He did is going to go to hell for that!! I mean, God CREATED children innocent and only capable of understanding so much! We as parents should be teaching them already, definitely, and guiding them towards the answers that they can understand, wherever they might be in their level of understanding, but I am not concerned for my children's eternal fates at this point, anyways. Does that make sense? I'm really not sure if a toddler can know what it means to ask Jesus into his heart, I doubt that they can grasp that concept the way we might think they should, but if my toddler expressed an interest in doing so I certainly would not discourage him, I would encourage him, although I would take it with a grain of salt, and just keep talking to him about it as he gets older to ensure he DOES understand what that means. I wouldn't go out of my way to encourage him to do so unless and until I can tell that he has a good understanding of what it means
I dont really know of any good books or anything on the topic, all I do at this point is read my children age-appropriate stories...like we have several books for them...cardboard ones....Children's Bible Stories, The Best Thing About Easter, etc. Just simple stories with great pictures that kind of expose them to who God is, who Jesus is, stories in the Bible, etc. I also pray with them every day. I take each day as it comes, I figure the older they get and the more they are able to understand, the more we will teach them, and the more questions we will answer, but to me it's a day by day thing and I don't worry about the deep concepts yet. Hope that makes sense!