We have plenty of other mates to use, so we should never need to impregnate her except in great need.
Then there are two problems if we don't impregnate her
1) We will remove some gift from the common genocode
2) She will stay magically tied to us to the end of world. Not the way to treat a friend
Pretty much any other female of some capability and ambition is better
Ambition = potential enemy. Why don't you value loyalty at all?
Gwen would have been better, for instance
If we found a way to ensure her loyalty... And I am quite sure that Alice would get more useful traits.
We're the last hope of the night troll race, the very last hope, we need to think in the long run.
That's we need to put fate of our race in the hands of someone we trust. Not someone random. That's obvious logic for the character.
I can't understand why do you think that first mother should produce many daughters. First mother should have nice traits and give birth to the future mothers with good, hand picked traits. This daughters may go that "flood the world with babies" route. In fact even one first daughter may be enough
As for converting the mermaid - it's absolutely useless in a short term period, we may even kill her if we attempt to convert her on land