This is very much my read on it also, and it's what elevates Knights of Guinevere for me. Before the pilot aired, there was a lot of "ha ha Dana Terrace hates Disney she is going to Epically Own Them!" going around, and a bit of a presumption that the sum total of the show's imagery and messaging would amount to "fuck you Disney! Blood and guts dystopian Disney Princess imagery ha ha fuck you!"
Which would have been fine and fair enough, and certainly a sentiment Dana Terrace has earned the right to!
But the show doesn't stop at a South Park-ian raised middle finger to the corporation, it doesn't just scoff and spit and cry "it's all phoney!"
The pilot is premised on an understanding that no matter how fake or how toxic it might be, the Disney Princesses and their stories are important to people (Frankie seems to most directly embody this, hallucinating Gwen in her most glorious form even when she's broken and damaged), and that finding love and meaning in these things does not make a person weak or stupid or bad.
It's... not necessarily healthy to fixate on it, and Frankie is very explicitly shown to retreat from reality into hallucinatory fantasy, and those fantasies cause her to act rashly and put herself in serious danger. But it's not evil, it's not stupid, and she isn't wrong to love Gwen and the beauty that Gwen represents.
Gwen, the Princess, is not the problem.
And neither is Olivia, really. She's a deeply traumatized child who was not only groomed and isolated by her father, but who seems to be stuck in a state of permanently arrested development, absolutely cocooned in saccharine childish fantasies, and consumed by the obsessive idea of "fixing" Gwen. If she can only "fix" her properly this time, then... then she'll stay. Then it'll work. If she can only make her PERFECT, then it will work.
There's a heavy implication that Orville is acting out of guilt for something, some trauma or pain that Olivia was put through because of him, and my read is that Olivia's obsession with fixing and "perfecting" Gwen is a sublimated obsessive desire to somehow fix, somehow undo, whatever that trauma is. My first guess would be the death of a loved one, and my first guess would be Olivia's mother (there's that conspicuous family portrait we see a couple of times + the umbilical cord imagery when Olivia pulls on her guts: a child yanking on the connection to a mother).
Olivia and Frankie seem somewhat parallel with one another in that way, opposites and complementaries. Both of them obsessed with Gwen, both of them in a state of alienation from reality. Olivia is physically frail, Frankie is physically potent, Olivia is rich and privileged, Frankie is poor and marginalized. Both of them are deeply marked by the neglect and abuse of father figures who think they mean well.
Olivia is not the problem, she's the product of the problem. The problem is the fucking park. This hovering, consuming leech on the world, gorging on resources and throwing up garbage and poison on the world below. It is the world, the structure, the system of cyclical and constantly escalating consumption - this is the thing which is not only poisoning the world, but which is strangling Olivia's life out of her with endless swaddling childhood, and which produces and commodifies Gwen's body (bodies?) for consumption and abuse, and which exploits the fantasies and dreams of people like Frankie and Andi, and poisons their world and impoverishes their lives.
And I think that's a lot more interesting and salient and complicated than "this show is about how Disney is bad and princesses suck" that I have seem some people kind of reduce it to. The art isn't the problem, the characters aren't the problem. It is the ravenous maw of consumerist exploitation which uses them as a lure.