I'm glad that you asked about what we think is going on! I think the little girl ran away from home with only her wand and loyal dog when her parents found out she had magic, and got lost in the woods. She came across the witch, who says she will help the girl find her way out of the woods. She has other plans. She takes the girl to a the bridge, and says that crossing the bridge is the girl's way home. In actuality, the bridge leads to the faerie realm, and all travelers who cross it are never seen again. The witch has an agreement with the beast's masters... she sends all lost travelers to it and in exchange she is allowed to live in the woods. However, right now the witch wants to see if the girl, who she can tell has some magic, can see the faerie beast. Only someone with great magical potential could see the beast. The girl passes the witch's test and the witch claims the girl as her own, protecting the her from the creature and taking her back to her cottage to become her new apprentice.
This entire scene has a faerie tale quality to it that I really love, and it feels as if the little girl is the protagonist of a children's book. Also, I like how the creature looks alien, not malevolent. Perhaps its that witch she has to really worry about! Anyway, I really love this piece. Thank you for sharing it!