Let’s look at some Candy Cane history. Why is she listed as American when her namesake is actually German? I think it has to do with the kind of candy cane she is. I’m no candy historian, however, I trust the articles I’m citing are reliable sources.
Now let’s start off with Candy Cane’s nationality in the game.
According to her description, she’s listed as being from the United States. This is most likely because the common candy cane we know today was invented just about 100 years ago. Even the shape is recent, due to a specially designed machine by Father Gregory Keller. Keller’s machine helped to give candy canes their trademarked shepherd's cane shape. The stripes on the candy cane are fairly new in its 300-500 year existence; the earliest ones were long white sticks of sugar with no decorations on them at all. Bob McCormack is credited with popularizing the red-striped design during the 1950s when his factories were able to create over half a million per day. [SOURCE]
Now let’s look back at Candy Cane’s description:
“A candy maker in Indiana wishes to make a candy for god to witness. He thus used many symbols pertaining to gods and combine them in a mere candy cane. This created the modern day candy cane we can find anywhere during Christmas.” [SOURCE]
Candy canes were not, in fact, made in Indiana. If we are being true to the original white peppermint stick, candy canes are a German creation dating back to the 17th century. However, even if citing our Candy Cane as the modern striped one, she still wouldn’t have been an Indianian creation. According to another source, the American introduction to candy canes was from August Imgard, a German-American immigrant who had also introduced the tradition of decorated indoor Christmas trees in Ohio. He decorated the tree with paper ornaments, cookies, and traditional white stick candy canes. [SOURCE]
So what about our Candy Cane? Well, she’s not a white peppermint stick, she has red stripes. And she surely does carry a candy cane with a J-bend, again credited to the industrial production of her namesake. With these two common traits in mind, I think it makes sense to appreciate this character for being the daughter of an immigrant's inspiration. No, Americans didn’t invent the candy cane, nor is the candy cane a purely Christian creation to begin with. However, with the most recent context of the treat in history, I’d like to think of her as an example of tradition and contemporary practices mixed together which at least from my perspective is a unique and staple ideal to Americans.