I had completely forgotten that part in Hans Christian Andersen's "The Little Mermaid" about mermaids turning into sea foam after 300 years if they don't get souls, until Retriever and bsking referenced it. I mostly remembered the ending as a muddle, with everything pointing toward tragedy, but somehow ending up vaguely positive at the end. For no reason I could remember. I looked it up today, and apparently I'm not the only one. P.L. Travers, who wrote Mary Poppins, found the ending deeply upsetting. Digging deeper, she is described as a folklorist as well as an author, which I had not heard.
I can't put myself into the minds of people hundreds of years ago, but it seems that these sorts of elements, of sentient creatures living on as natural phenomenon recur frequently. Myths and legends recount how the sun came to be in the sky or the leopard got his spots. If you follow this stuff often enough, Indian maidens are always looking into pools for their lovers or mothers or children forever at the end of the story; European maidens are turned into trees or blackbirds, Asians into bears or fish. For some reason, women get turned into stuff more often than men. Perhaps it is because at hearthside, women were more often telling the stories.
This became much more intentional in Europe, as in Hans Christian Andersen, Rudyard Kipling, . Fanciful explanations popped up everywhere for everything. We even call those back-impositions of our fancies onto the actual phenomena "just-so stories" now, after Kipling. Tolkien uses it in fiction, and Lewis slightly. It seems to have been in the air for those interested in older stories. If there were water falling or an animal with an unusual feature, someone was sure to invent a tale for how that came to be.
If we view the mermaid turning into sea-foam from the other direction, of an imaginative person standing by the shore and thinking how the foam seemed to have it's own personality, and a delicate, feminine one, it may look a touch less strange. But to our eyes, it still seems to be some weird consolation-prize. You didn't get the prince, but at least you get to exist in some interesting form rather than passing immediately into oblivion. Perhaps in eras when people died young, oblivion was closer to the truth, and more folks were out experiencing natural phenomenon it all seemed rather romantic. Maybe. It still seems creepy to me.
Interesting addition: When reading up on this, I saw a good deal of commentary about Sleeping Beauty, Snow White and other sleeping princesses being descended from stories teaching that if you loved someone strongly enough, you could bring them back from the dead, which was a newer idea not found before 1700 or so. Less frequently it would be a male figure who could be brought back by his true love, though she usually had a harder time of it than just kissing him.
Prior to that there were myths of many lands which recounted fascinating stories of people trying to rescue their loved ones from the clutches of death and the underworld. But in those, the message usually was You can't. They're dead. Some sort of moderate optimism began to overtake Europeans in the Middle Ages, and now we can't tolerate stories where the hero(ine) does not revive.
It put's a different spin on Disney, doesn't it?