I say return all the candies everyone has used, and raise the treat rate.
Also, limit the candy amount given to npcs to 10/20. 20 for max chance of getting something good (NOT FOOD, NOT JELLYBEANS, NOT GLOWSTICKS, A HAT OR FURNITURE)
You could also, make npcs who give something good, allow you to give them 20 candies, while the rest who aren't so generous receive only up to 10 candies. That way, we can know what to expect and decide if we want to use the candies on them or not.