Neither the mother nor the recliner are at fault here. Both correctly paid/booked the seats they wanted to accommodate the safety and comfort of their flight, but the airline took the mom's money for the extra safety she wanted and basically denied her that and screwed it up for both parties.
They should have offered the recliner or the mother a different seat that was suited to what they paid (allowed for car seat or reclined), and barring one being available, they should have apologized to the recliner and refunded their seat because the safety of the baby is obviously more important than comfort, as frustrating as that might be for the recliner. That the airline handled it the way that it did and made an absolute hash of things AND refuses to properly compensate the mother is ridiculous.