For compensation-purposes only, state source in most cases in the location the work is performed. You are correct that if she had a "hybrid" schedule, the state wages would be allocated. I also want to refer you to New York Convenience of Employer Rule - TurboTax Support, and How does working remotely affect my state taxes? for reference.
As far as the Paid Family Leave, you should first check if NY PFL is on her W2 (usually if the state tax is withheld so is the PFL). You can request from the employer to have the Connecticut PFL returned.
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