Stiles isn't the only one who doesn't like puppets, muppets, wooden dummies. They're all a little creepy as far as Buffy is concerned. She's really, really not interested in theatre or anything billed as boring, but she is interested in what passes for citizen improvement here. Since she has no interest in the show or theatre in general, she does some wandering and picks a wall to lean against far from the stage. The muppet catches her attention right about the time it does Stiles and she sees that look he's giving it.

"I don't get it. Who finds those things cute? Anything made of wood or stuffed shouldn't talk. Did we learn nothing from Chucky?"