Could be a sinus infection or maybe she put something up there. Toddlers do some funny things. Does she snore or kind of stop breathing for a second in her sleep? My daughter use to get a smell and she also got strep throat a lot. She ended up needing her tonsils and adnoids out.
Can either be the same smell that would come from a sore throat in case he/ she has a cold or he/ she may have pushed some food bits up into the nose. If you worry, get that little nose inspected by a doctor with a flash light. It only takes a minute.
Brings back memories: at preschool, my the barely 3-year-old had to bring in an item starting with the letter H. He brought in a little plastic heart the size of a chick pea. When I picked him up later, he had the heart in his hand and oops - there it was gone up his nose, right in front of my eyes. Trying to get it out, he pushed it further up. I could even see a bump on the outside of his nose.
Our doctor thought we were joking but eventually got it out with tweezers.