I was a teacher at the time your daughter was at school. I always used to correct spellings, though not always all of them. It could be too discouraging to some pupils. However, I never used to put sp. in the margin, and I never used a red pen.
What is the point of telling children they cannot spell and then not giving them the correct spelling? They would have to write out the correct spelling in a small book, after I had written it in their work.
However, what was more important was to tell children they could spell most words correctly. In most pieces of writing there are only a few words misspelt. I consider myself fortunate that I do not have problems with spelling. I taught myself to read sitting on my dad's knee, while he read the newspaper to me before I was 5.