I haven't read the story yet, but from your little paraphrase, I think you guys did a great job! The dolls are adorable, and your choice of the black and white grainy photos really does make it seem like an old silent film...I keep waiting for the scene of the train about to run over the person on the tracks. Hahaha, that was silly. You know what I mean though?
Oh, and did you use a pattern for the dolls, or did you make them up as you went along?