Fact: I am at a loss

How do you stop your toddler from doing something? Obviously there is timeout, spankings (in line with the law- I'm no beater, but discipline is key) hot sauce or vinegar for thumb sucking or biting, but what about this.....Hair pulling? Yes hair pulling. My little princess currently is beginning to look like Prince circa 1985. This is because she has plucked all the beautiful ,bouncy, sandy blonde, curls from the left side of her head. WTF? right?! It is making me so very sad and scared to be honest. What do we do ? Shave her head, cut it super short, leave it and buy her all purple velvet outfits ???  I have no idea !
                           Since a wee tiny babe my sweet Eden has loved crocheted and knitted blankies ONLY. She will refuse and ultimately throw a crazed fit if she can not have this very specific type of blankie. Her tiny fingers weave in and out of the holes and she twists, and twist and twists until at least one of her fingers is lacking all blood supply and has turned dark purple. It is her soothing ritual to fall asleep or watch tv, she sucks her thumb and twists the blankie. So far, countless blankets have been destoyed having to cut her free. However, once the finger returns to its previous fleshy hue...the love affair continues. Its as if it never happened, and she returns to another blankie to do it all over again. We finally put our feet down and hid away all "holy" blankets to save her from dropping a digit. (I picture the rubber band on a dogs tale and my imagination runs wild, it scares the crap out of me.)

Unfortunately since the taking away of her favorite thing, as most would , she has found a replacement. Her curly golden locks. Easy for twisting and no one can take them away. Then, once completly tangled she pulls to free her finger thus losing said curl - leading to a good portion of the whole left side being gone. Ive given back the blankets during the day so we will see.  Short of joining the Revolution, I am at a total loss for what to do from here if it continues. Ideas anyone ?

Update:

So we cut her hair short to try and even it up a bit. So far so good. I would take pics to post but since the camera was stolen it will have to wait. BOOO !!