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Part of the scholarship is not taxable income if it used for tuition and fees (required by the school) or fees, books, etc required for cources.
As I know Federal Pell Grant is used for tuition and fees only and not taxable income.
1098-T reports which part was used for tuition (box 1) and these money are not taxable.
see for reference IRS publication 525 page 31 - http://www.irs.gov/pub/irs-pdf/p525.pdf
These grants are for your daughter? is there her SSN on 1098-T? Did you report it as your or her income?
Do you mean Scholarships and Grants in box 5? - http://www.irs.gov/pub/irs-pdf/f1098t.pdf
Seems that these grants are not taxable. This means that from billed amount of $6,125 Scholarships and Grants paid $3,150. You should not report this amount as taxable.
Did you pay the difference? Or took a loan? either way educational credit may be claimed. If you claimed your daughter as a dependent - you may claim the credit.