Please: 1 year old female baby, medical, medicine question?

Question: Story: My 15 month old daughter went into the hospital because of a stomach virus that caused for her th have unexplained seizures. They needed to insert a catheter (i hope i spelled it right) to collect a urine sample. They couldnt get urine to come out because she was dehydrated, so the nurse jigged the catheter in and out and around while still inside my baby, still not getting any urine but 2 drops. When she pulled it out blood spewed out and didnt stop until they applied pressure to her urinary opening. (This pissed me off! This was in the PICU ((pediatric intensive care unit)) they should have known better, and the only thing the nurse could say was oops, while the other said OMG)
For the next 2 days while in there she was heavily medicated since she had to undergo a spinal tap and to prevent more sezuires. So she spent most of the time sleep and woozy not being able to walk or barely able to sit up for more than a few seconds from time to time.
She wasnt able to walk for the first day and a half at all once she was back home from the hospital.
I noticed that after her discharge 2 days later she began to pull at her diaper and I didnt think nothing much of it.
But I said I would check, so I checked down there and it looked as if her urinary opening was swollen. So I took her to the dr today and had her check. And it was swollen and bothering her because of the catheter. So she explained that she had to have the catheter because the hospital really needed it. But she didnt address if that was normal or not how they went about trying to get it. She just went on about how back in 1980 they had to extract urine in a much more difficult and painful way and this was much less the hassle, blah blah blah! The was no infection just trama from the catheter. She prescribed a cream to apply.

PROBLEM/QUESTION:
She prescribed: Nystatin
Common Brand Name: Mycostatin
To be applied to the affected area 4 times a day fo7 days

On the paper that tells me about the medication it says:
to treat fungal skin infections; nystatin is an antifungal that works by stopping the growth of fungas; if in the diaper area of an infant do not use tight fitting diapers; DO NOT APPLY THIS MEDICATION IN THE EYES, NOSE, MOUTH OR “VAGINA”
It says its for a fungal infection, but my baby doesnt have a fungal infection nor any infection at all. Could this be an error in medication??
“do not apply this medication in the vagina” Wouldn’t the urinary opening considered “in the vagina” since you have to spread the viginal lips to get in contact with the urinary opening????

I have applied this medication to her 2 times so far today and will not continue until tomorrow because we didnt get it until this afternoon after the dr visit. So any nurses or dr’s that available or anyone who has gone through this please give me guidance. Thanks in advance