I agree. While I can understand that it may be important for dancers to work out some kind of logic in the story in order to help them perform, I don't think that that benefits the audience. In fact, I think the contrary is true -- some ambiguity makes it a richer experience for the viewers. It can mean so many things, instead of just one.
I don't think it's important whether the Sleepwalker is wife or daughter. Her protected, virginal state is what matters.
With regard to the ballet performed in Denmark, I imagine there must be differences from the version done at NYCB. The Danish version is probably closer to the original, called Night Shadow. (Alexandra, is it really called La Sonnambula today, and if so has the title changed over the years?) Since Balanchine constantly fiddled with his ballets, the version he eventually staged for NYCB in 1960 probably differs in some respects. (The Host/Baron nomenclature may be one of these.)