For me we never put negative connotations around the term princess ie "youre acting like a princess"

So im fine with dd1 wanting to be like a princess as i just see it like imaginative play really.

She will dance and sing and dress up like a princess with a crown. Thats about it.

I dont think she knows much about it being royalty and stuff i just see her wanting to be like cinderella and princesses in frozen, tangled, etc