Gender confusion

Ella was playing with a travel game this morning, talking to the pawns as if they were people, when I found 2 of the pawns on the floor.

So I picked the first one up and gave it to her saying:

Me - "I fell down and I hurt myself!"
Ella - Oh, I'll give you a bandaid
Me - [Picking up the 2nd pawn] "I fell down and hurt myself too!"
Ella - She can have a bandaid too because she hurts she's knee.
Me - Her knee.
Ella - No, she's knee.
Me - No, it's her knee.
Ella - No, it's she's knee.
Me - She hurt her knee. He hurt his knee.
Ella - No, they're both girls.

I give up.