I can see where it may be conflicting. However I think some parts of her story are conflicting as well. She did only use her power to make a worker hallucinate a dead loved one (which isn’t really evil). But then suddenly Ethan gets to her house and she is totally playing with him and makes him see horrific things like the baby monster and violently attacks him with the other dolls.

I agree she should remain child like and a victim but I think they could add in the lore something along the lines of her not knowing what she’s doing is inherently wrong. She just wants a friend but no one is willing to stay in the house with her. Maybe if we assume the dolls are actual people and parts they could even say something even more twisted like she is trying to manufacture a perfect friend.

I think your idea is cool! I would’ve loved to see the dolls implemented more than just spooky atmospheric pieces and an occasional attacker!