I found some canon-ish (or at least DC-approved) Dadwald content in the 1980s short story collection The Further Adventures of Batman 2, in a story called Hide and Seek by Kristine Kathryn Rusch. The Penguin starts kidnapping children, no doubt for some terrible nefarious reason…! Which turns out to be that these kids were all victims of abuse, and that there’s an epidemic of child abuse in Gotham that social services and the GCPD are doing nothing about. Penguin figures he’s rich and can do way better as a parent (and he freely admits it won’t hurt to have some judges and lawyers in his pocket once his kids have grown up into successful members of society). Batman, despite being “almost sucked in by Penguin’s explanations, by his obvious commitment to those kids” takes him down, concluding that “no matter what material possessions Penguin had, he could never give those kids love” (because, uh… pretty much because he’s a supervillain, I guess?) At least it shames both Bruce and Jim Gordon into doing something about the kids’ parents and looking at the state of child welfare in the city, and Penguin gets away, vowing to be more subtle next time.
One more excerpt that didn’t photograph properly:
Penguin pulled his gun, aimed, and was about to shoot when
something crashed into him. “Imbecile!” he cried as he turned – and saw a little boy, so
thin that his bones stood out in his skin, bruises covering his tiny body,
staring at the guns all around him.
The world froze for a split second. Batman swinging
overhead. Bullets spraying around them. Guards on all sides, focusing on
killing. And a little boy, the kind Penguin wanted to save, in the middle of it
all.
“Get him out of here!” Penguin cried.
Someone grabbed the kid’s arm, then Batman swooped down and
scooped the kid up with one hand. The guards continued shooting. Bullets ricocheted around the
small space. They could all get killed. The little boy would get killed and
Penguin would lose his one and only chance to be benevolent.
“Stop firing!” he called.
Batman vaulted over the railing and disappeared.