Hello Philip,

From the 1881 census:
Francis LOONEY Daur U Female 28 Maughold, Isle of Man, Domestic Labourer
Mary Ann LOONEY Daur U Female 24 Maughold, Isle of Man, Domestic Labourer
Mary Jane CALLOW Grandaur U Female 5 Maughold, Isle of Man

Either of these (then) single daughters also could have been Mary Jane's mother, along with Caroline & Elinor, although Caroline now seems less likely to me because of not finding a bapt for the baby. In those days many mothers appeared to have very long pregnancies, having babies baptised long after a husband's death. This would have been easy for Caroline because she already had been married to the "correct" surname.

In the 1891 census Mary Jane's birthplace was also given as Douglas by her uncle John R Looney, as he did in 1901, so not an error.
[1891 Findmypast]:
Name Relation Condition Se x Age BirthYear Occupation Where Born
LOONEY, John R Head Married M 52 1839 Farmer Maughold
LOONEY, Jane Wife Married F 61 1830 Maughold
LOONEY, Evan Brother Single M 41 1850 Maughold
CALLOW, Mary J Niece Single F 15 1876 Domestic Servant Douglas

RG number:RG12 Piece:4684 Folio:167 Page:2
Civil Parish:Maughold Municipal Borough:
Address:
1, Ballagilley, Maughold, Sulby County:Isle of Man

Unfortunately I didn't find an illegitimate Mary Jane Looney in Maughold records, or looking on the IGI using Douglas & Braddan batch numbers. By using batch numbers you can search without using surnames, but the disadvantage is that many Church members' entries have displaced extracted parish register entries so won't come up under the batch number.
Additionally the IGI seems to omit some Douglas Church entries after 1874, so someone would probably need to look for her in the MM records.

Sue