but to be honest, I really don't know much about the disney princess line. apparently it's very popular? and there are direct to video movies?
The Disney Princess line is basically just a marketing brand, created by Disney Consumer Products. If there's a Disney-branded thing that you can buy, Then Disney Consumer Products probably had a hand in it.
- Merida from Brave is in, despite the director intending Brave to be a subversion of Disney Princess stereotypes, because her toys sell well.
- Mulan is in, despite not technically being a Princess, because her toys sell well.
- Anna & Elsa are in, despite Anna being a Queen, because she looks young and their toys are selling amazingly well.
- Meg is not in, because her toys don't sell.
- Nala is not in, because she's a furry, and doesn't fit with a line that was built on uniformity.
The direct-to-video sequels were initially just a cheap moneygrab pushed by Eisner, and not part of the marketing plans of Disney Consumer Products. When Lasseter took over, one of his first orders was that all of the cheap sequels had to end... unless DCP said they specifically wanted them. DCP has a ton of power, because the Disney Princess line of merchandise rakes in epic amounts of money.
Tinkerbell's toys have been selling amazingly well for ages, so one would expect that she'd be an easy pick for the Disney Princess line, but DCP invented an entirely different line around her, the Disney Fairies line.