Vocabularily Challenged or Not Deceived by Appearances--You Decide!

Today Cindy was driving to Sam's Club with Ally, and they passed a business with a big frozen pond located next to the road.

Cindy called it to Ally's attention by saying, 'Look at that Ally!'
Ally excitedly responded, 'Look at all that water!'
Cindy gently corrected, 'That's not water--it's frozen!'
Ally rejoindered, 'No it's not! It's ICE!'

Questions:
1. Was Ally mistakenly thinking that the word 'frozen' was a noun?
2. Or was she letting her Mom know that the chemical composition of water is the same regardless of its liquid or solid state?
3. Or was she surreptitiously trying to remind her mom that she needed to express herself more clearly and precisely?
4. Or was she just being a smart-aleck?
5. Or was she just completely oblivious?

*correction from Cindy- Ally told me excitedly to look at the water. I said, "Wow! It's frozen." She said, "NO it's NOT! Its ice!"

Still a nice post Dear!