>Seems like it'd be weird for him to only now be learning things.
Everything he's learned has been partly the dark haired woman's fault. At least he only questions himself because of her. The point is probably that you can't just "be" human if you act as an observer and don't involve yourself with them.
After all, humans are so fucking special.
>Speaking of those dolls, what do you suppose happens if someone chooses to stay there?
>Is it possible he actually turns some people into dolls?
Everything he does is with the intent to fulfill his duty as an arbiter, at least it has been so up till now, so he would probably try to find out their "true" self regardless of what they choose. The game is just the easiest way to let people reveal their self, is what I think, and fear is just the motivation to do so. And he probably isn't turning people into dolls, but he is instead fascinated by humans and can't just get his head around them. He makes images of humans, dolls, and is able to control them with strings, but he is unable to make them become "human". He's an imitator with no clue as to how that which he imitates work.
Maybe they have to have some sort of connection and can be seen as some sort of duplicates? I don't really know.