These are what we call the 'YMMV items.' Things that some people find in this work. We call them 'your mileage might vary' because not everyone sees these things in the same way. This starts discussions in the trope lists, a thing we don't want. Please use the discussion page if you'd like to discuss any of these items.
Alternative Character Interpretation: The obvious: Old, lonely Eder has gone crazy, and Pumuckl exists only in his imagination. Eder's friends are right when they say he has bats in the belfry. Note how Eder is single and a lifelong bachelor; Pumuckl is a hallucinatory substitute for Eder's repressed desire to have children.
Pumuckl has been known to invent Kobold Laws at his convenience. Maybe the law about staying with the first human to see him was his invention too, because he simply wanted to stay.
Tear Jerker: Once, Eder got so angry at Pumuckl that he kicked him out.