Hi CB, I hope you won't mind my philosophising here, but I was the go to person for diabetes in the hospital where I worked. I devoted my life to keeping my very young toddler alive with multiple insulin shots and the insulin pump. He's 44 and traveling the world in his job today.
A possible simplistic understanding of what happened could be, Mum had high sugars due NOT to her fault, but due to genetics, and baby said hey, wait a minute I have too much sugar coming to my body so I will have to adapt and produce more insulin to get the sugar level normal.
Ok now, baby is born and her little body has adjusted to high sugar and now, all of a sudden, this has changed and her pancreas and liver have to make adjustments to stop being in insulin overdrive. This obviously takes a little time.
The body is a miracle and will often self correct if given a little help.