Lili is seen as a bratty little thing for not accepting Claudia's friendship at the start of the story. While it's very bratty at the beginning (throwing oil in her face for instance), don't forget that Lili saw Nannau being killed by something when she looked into Claudia's mirror. As it turns out, she had valid reasons to be suspicious of Claudia.
Frederich with regards to if he loved Claudia when he married her. Claudia seems to think she was just there to produce an heir, and desperately wants him to love her. But he does seem kind to her and could potentially have loved her too; it's just that the first Liliana's death was on his mind.
Angst? What Angst?: Lilli seems a little too calm for someone who was nearly murdered and has to live out in the forest. She also seems to take Peter's death quite easily.
Big-Lipped Alligator Moment: There's a scene just before the poisoned apple where Peter returns to the Hoffman house to find Claudia alone. She gives him a passionate kiss, but then sends him away saying "what a wonderful husband you're going to make Lilli". It's already been established that the servants are gone, so this scene serves no real purpose and is truly random.
Fridge Brilliance: Why does Lilli take fruit from an Obviously Evil old woman? Because after living with the miners and discovering that Will was not just a savage, she had learned that appearances can be deceiving. So she must have thought that the creepy old woman was friendly.
Harsher in Hindsight: Brian Glover gets crushed to death by a falling tree. He would die in real life before the film was even released.
Some context - when Lili first joins the miners, they mockingly call her a princess. When she leaves them to rejoin her family, one of them says "good journey, little princess."
A Freeze-Frame Bonus. When Lili attempts to make amends with Claudia, she's wearing the dress that her stepmother wanted her to wear at the ball.
Intended Audience Reaction: It's entirely possible that we're not supposed to root for Lili at the start - and the story very much frames Claudia as the sympathetic figure. Thus it makes it all the more effective when Claudia pulls her Face–Heel Turn, and viewers are left reeling that simple brattiness is hardly reason to justify murdering your stepdaughter.
Jerkass Woobie: Lilli mainly in the early part of the movie. She's bratty and completely dismissive to Claudia's attempts to be friends, but remember that this is a girl who has never known her mother and also watched her nanny die before her. She becomes a full Woobie once Claudia starts trying to kill her.
Magnificent Bastard: Claudia, as her attempts to kill Lili are effective enough to at least cause the deaths of a couple of the miners.
When the story begins to play out like the classic fairy tale. It's Gustav - a character seemingly benevolent - who draws his knife on Lilli. Notably even Lilli seems to view him as a friend, and it's quite the WHAM Shot when he lunges at her.
The first two attempts to kill Lilli that Claudia tries. The poisoned apple almost seems tame in comparison.
The sight of the hand of Claudia's zombified baby reaching out from his blanket. That ENTIRE SCENE is frightening.
This Darker and Edgier take on fairy tales was pretty new at the time, as the Disney Renaissance was in full swing, and the child friendly versions were what audiences were most familiar with. Now with Grimmification being everywhere - ironically popularized by another Snow White film (Snow White and the Huntsman) - it can be lost on newer fans just how daring this movie was.
Giving the evil queen a tragic backstory? Again, hugely uncommon in mainstream media in the 90s. Nowadays with the likes of Wicked, Maleficent, Once Upon a Time etc turning a Wicked Witch into a Tragic Monster, the trope that the villain was once a genuinely good person isn't as shocking as it was.
Finally it's a surprise ending that Lili ends up with Will, the Troubled, but Cute exiled miner - instead of Peter, the Prince Charming analogue. After hundreds of revisionist fairy tales, about the only thing not surprising here is that Peter isn't a Prince Charmless.
It's really hard to not feel sorry for Claudia after she loses her baby. Lili's reaction is notable too. She had been tense with Claudia, and seems to have gone to the ball deliberately to show her up, but she is horrified when she hears that Claudia won't be able to have another child. This prompts her to try and mend the rift between them.
And after Claudia loses the baby, she looks in her mirror and takes a look at her face - realising she is now much older. She tries to rub some lotion on her skin but then screams and throws it at the glass, before collapsing sobbing.
The death of Lars just after he and Lilli had started becoming friends. She desperately tries to rescue him from the tree, but Will has to pull her away before another tree crushes them too.
When Lili returns to the castle, her beloved dog Odo has been corrupted by Claudia's magic and attacks them.
What Do You Mean, It's Not for Kids?: Naturally, being an adaptation of Snow White, many parents would assume this is alright to show to children. They ignore the R rating and the fact that it's got "A Tale of Terror" as it's subtitle.