Short answers, pulled from the story.
Reverend Robert Kirk of Aberfoyle, Scotland wrote The Secret Commonwealth of Elves, Fauns and Fairies in 1691. Kirk described fairies as intelligent fluid spirits with bodies like condensed clouds that could appear or disappear at will. He documented how these creatures could alter their forms to suit their whims and claimed to have been taken by the fairies himself.
Christian theology holds that fairies were a class of demoted angels caught in the middle of a cosmic rebellion when God ordered the gates of heaven to be shut. These entities existed as subjects of Satan yet were not quite devils, occupying a middle nature between man and angel. King James I reinforced this view in his 1603 dissertation Daemonologie by classing fairies as illusory spirits that prophesied to and transported individuals.
Scottish folklorist David MacRitchie developed the theory that fairies were the memories of a prehistoric race of people in the late 19th century. This theory suggested fairies were remnants of a defeated people who used superior knowledge of the land to survive in the shadows. Proponents pointed to the tradition of cold iron as a cultural memory of invaders with iron weapons displacing peoples who had only stone, bone, and wood.
Pre-industrial European families feared changelings because a child who was a permanent drain on scarce resources could pose a threat to the survival of the entire family. Elaborate protective measures included wearing clothing inside out, using church bells, or placing bread in a baby's bib to ward off witchcraft. The theme of the swapped child was common in medieval literature and reflected concern over infants thought to be afflicted with unexplained diseases or disorders.
Victorian flower fairies became popularized in part by Queen Mary's keen interest in fairy art and by British illustrator and poet Cicely Mary Barker's series of eight books published from 1923 through 1948. This era saw an increase in the popularity of collecting fairy folklore and an increase in the creation of original works with fairy characters. Imagery of fairies in literature became prettier and smaller as time progressed during the Victorian and Edwardian eras.
A mortal woman who uses fairy ointment on her own eyes becomes blinded in that eye or in both if she used the ointment on both. This punishment occurs because she sees the true nature of the fairies after realizing she was not attending a great lady in a fine house but her own runaway maid-servant in a wretched cave. The use of magic to disguise their appearance was a common feature of fairies who could assume the guise of an animal or take on the shape of a great horse with the wings of an eagle.