Very much so. Young children are still learning the basics of physical interaction with the world and how the world works. Its is incredibly short sited to give a child lots of exposure to touch-controlled devices and then delude yourself into thinking you've found some sort of insight when they assume that other things might have touch interfaces. They don't have enough knowledge about what things are to reason and infer about them like we can.
No, its not crazy, its perfectly logical. You're niece is learning how things in the world work out of necessity, touch interfaces being just one of many completely new-to-her things she is exposed to. Your mother has had many decades of a firm grip on how things in the world work and touchscreens are completely new to her extremely-entrenched mental model of the world.
The classic example of a child's mind being more flexible is the window of time wherein the human brain is more able to learn laugauge. After a certain age, the brain develops to a point where it puts up a wall that increases the difficulty to teach someone a second language, even though on the surface you may think that someone with lots of experience using language might have an easier time picking up a second.