I've never understood why they're called "Babies" when they're clearly old enough to walk around and speak coherently. Some of them are in diapers, sure, but they seem to be old enough to not need them in a little bit. I dunno. Muppet Babies loses all its logic if you think hard enough about it. Best not to dwell too hard on it. I doubt that the Muppet characters were in a year's age difference back then. I mean, Baby Kermit already had a nephew at let's just say age 3. By that logic, sure, nephew by the definition, but they'd be roughly the same age, not a 20 something-40 year something old character with a 6 year old.
Just...when it comes to Muppet Babies don't think too much about it. You don't want to go down the rabbit hole and realize how negligent Nanny is for leaving the room that many times an episode instead of watching them.