A few weeks ago, Jess Harris-DiStefano woke up at 3 a.m. in a panic. She had forgotten to move the toy elf that supposedly keeps an eye on her daughter’s behavior to report back to Santa nightly. The elf returns from the North Pole by morning, goes the elf’s story—which her 4-year-old believes—landing in a different spot in the house each time.

Ms. Harris-DiStefano has a dog, and her daughter is a light sleeper. Turning on lights or making noise wasn’t an option. Neither was leaving the elf there in the dining-room table...