You're getting bogged down in irrelevant details.
The basis portion of the 529 was after tax money and is already include in the gross distribution (box 1). You can't double count it.
You don't really need to charge her anything. You are putting out cash to buy her food. That's good enough. You don't need receipts; the IRS *always* accepts the school's board numbers. I'm sorry I mentioned the "charging" concept. I don't think it's needed. Others have suggested charging rent (but not board) would be a CYA technique.
Transportation (gas) is not a qualified educational expense.
Out of pocket books and software are qualified expenses
