Both the hair and the body change colours, and the hair does go all fluffy when it's been overworn. I kinda like it when it's soft like that. The real hair is definitely different from pony hair and I'm not sure there is any accurate replacement, so it would really be a case of choosing one of her colours and rooting her normally, or using thermal hair but accepting it isn't the same colour or texture.
I'd personally just leave her and upgrade if you don't like the hair as it is. There are still ponies around with hair in good condition, even if it doesn't still change.