Ernie Bushmiller was one of the most surreal cartoonists of his time, and this is a good example. Nancy’s and Sluggo’s bodiless heads pop up from side-by-side Jack-in-the-Boxes without any indication of who or what flipped open the latches simultaneously or why.
Nancy’s parents never appeared in the comic and their absence was never explained; her only caretaker was her Aunt Fritzi.
Fritzi Ritz was once an elite party girl, a flapper, who predated the Nancy comics by a few years until Bushmiller took over the strip created by Larry Whittington in 1922. Bushmiller modeled Fritzi after his own fiancée (according to Wiki) and Aunt Fritzi eventually served as Nancy’s benefactor and disciplinarian. We can assume that she recognized Nancy’s psychosis, even though Fritzi was not quaified to raise a child with mental troubles. Although not an ideal model for a young child, Fritzi did the best she could given the circumstances.