So I think that The Unknown is a realm like Wanda created in WandaVision, where when you get sucked in you must play your part like the Beast says. But Greg and Wirt are outsiders to the realm- they weren't in the area when it was created. So when they enter, they still possess full control of themselves, but the Beast is constantly wearing them down, trying to force them to do what he wants. And when he died, the realm collapsed, and that's why the woodman's daughter was alive etc.