I ADORE Totoro, but I did want to point out that for very sensitive little ones, there are a few scenes where Satsuki confronts the idea of her mom dying. Now, she doesn't die, but she is in a hospital and it's kind of lingering in the background until the end. Mei (little sister) also runs away at one point and they insinuate that she may have drowned.
It may all go right past a little one (my 2.5 year old doesn't seem to notice), but my almost 5 year old always wants to curl up in my lap during those parts and is noticably on edge. Despite this they both adore it and it's one of those movies DH & I don't mind watching with them because it's just so magical and well done. I may even love it more than them!

Just wanted to make you aware of the sensitive parts.