Louise, The Adventures of a Chicken by Kate DiCamillo, Illustrated by Harry Bliss
Louise is a chicken who longs for adventure and she goes on some very exciting adventures in this picture book which is almost a chapter book. In fact it is separated into four chapters. Because of the length and sophistication of the book, I'd say it is one of those elusive 3rd grade level books, though the large format is that of a picture book.
The illustrations by Harry Bliss (of Diary of a Worm fame) are lush and romantic. They look like a cross between a Winslow Homer painting and a cartoon. Don't believe me? Check out the cover!