Typical. Instead of deciding to make peg dolls with existing parts, we (erm, that's the Royal We) alter the parts. Mr Little Brown Dog is an angel and drills and turns pegs in big batches for me to make bespoke pegs to fit the head beads I like to use.
Most of the dressed pegs start off with a little felt camisole, stitched down the side and secured over the arms and with an eye-watering little g-string under the legs. Any outfit can be layered up and anchored securely to this little foundation garment!
The peg dolls look a bit odd at this stage, but I've found a headless figure is easier to negotiate with a needle, so I dress the figures first and glue the heads on afterwards.
Sometimes their hair is painted, sometimes added as fleece or yarn. Sometimes (this feels like a guilty secret) if the doll is wearing a hat, I sew the hair to the hat, and then glue the hat and hair in place together.