I have the Mattel version of the set! I'm pretty sure that it is NOT made from actual wool; the yarn is soft and smooth and has a certain "slippery" feeling that reminds me a bit of the cotton/ramie sweaters I wore as a child. It's still absolutely adorable, though. I also agree that it is quite tight on my PM Kirsten. I've been hesitant to try and close the cardigan out of fear of popping a button.
The hat fits my Kirsten just fine! I think it looks so cute on her. The mittens are also quite sweet, but, as I didn't have that handy guide to dressing her that was so kindly posted here, I couldn't quite figure out how to get them onto Kirsten's hands without making her look silly. So you get to see them on her lap.