It's more tragic because the trigger for the Real Yvonne's death was ultimate the day the duke found and adopted Penelope. Witnessing that, the child didn't understand what was going on, the thing that possessed her took the chance to kill her and fully take over her body, her last moment, she was frightened and felt abandoned, her will withered away and she died silently.
Ancient wizard saved her soul though, and she was brought to the mirror, Where she met Penelope the one who "replaced" her. Penelope explained that she wasn't abandoned, she was loved, she could never replace her and that her family missed her so much (Penelope explained that she too suffered for taking her place) . The child finally found peace after learning the truth and went to reincarnate after leaving Penelope her message for her family. Everything is so sad for both Yvonne, Penelope and the Duke.

The Duke fully realized that "That thing" isn't his daughter Yvonne, as a father, he was helpless and lacking as a result he lost both of his daughters. Yvonne's first assumed death was when they lost her, And when the Duke found out that something was occupying his long lost daughter's body, he had to accept Yvonne's second death. The third and final time the duke had to accept Yvonne's death physically was when Penelope brought him the news that she had to kill Yvonne and it was unavoidable, since her body had already merged with that thing.
After bringing the news to the duke, Duke had to lose Penelope again too. Since Penelope announced she will leave.
Penelope actually meets the real Yvonne and she delivered Yvonne's message to her family who was waiting for her. Real Yvonne hadn't grown up, she was still just a child at the moment of her supposed death.