I have lots of family from southern MO and northern AK, and I have never heard this term. I’ve heard dall instead of doll, but otherwise it’s just known as a toy.
Play-purty means nothing to me other than an attempt at a dialectic spelling of play-pretty. I’m sure that personally, I pronounce pretty as pritty, except on the rare occasions I want to imitate my hardbitten farmer relatives and say something is “purtier than a lil red wagon goin’ up a hill.”
Play-pretty, though sounds to me like how a villainous witch would refer to a captured hero in a fantasy movie.
“Ooh, Graymalkin, what a lovely play-pretty we’ve found. Better put it away with all the others. Cackle, cackle!”
The phrase is heard very seldom now but when I was growing up in Georgia it was used by the older folk to refer to an infant or toddler’s toy, usually something small like a doll or a trinket.
Specifically for us it was a very distinct type of toy that was brought to church or to meetings or used for blanket training. Usually a book or a folded quilt, with each page or patch having bits of laces or snaps or buttons or sliders or whatever to keep the kid busy. Some had themes or stories, some just had the things to do.
The old grannies called it a “play-pretty”, but usually we called it a “quiet book.” The more active version was a “latch board” that was usually made of plywood or masonite and had actual metal latches and catches and fasteners.