I thought it was bugged as well. Until I reloaded a save before I used the pixie dust, that is.
I thought the criminal was the proprietor of the brothel and wanted to pixie dust her scampy little face in. I Thought she would turn into some kind of monster.
I also came to the same conclusion before I figured out that there was more too it. Of course her nature was part of her, erm, profession, but I thought it meant that she was hiding something.
