After talking to a few people, I decided to cut the sleeves off and try something different. The result was MUCH better. The dress is a bit big on her, but truly that was the point. I didn't want to make something she'd only wear a few times. I also left me some room to adjust the dress as she grows so hopefully if the Chiffon holds out, she can wear it for some time down the road!
Here is Abi modeling the finished dress for you:
A close up of the finished sleeve...much better then the wrinkled, bunched, thread showing catastrophy that it previously was: