Yeah, that confused me a lot, too.. Even before the movie came out, I was like, "That's kinda funny.. From what I've seen from the trailers, Lotso kinda looks like he's going to be the next Stinky Pete. But they're trying to sell a whole bunch of toys of him and he's got an in-park character.. I wonder if he'll turn out good after all?"
And this in turn made me disappointed that Lotso didn't have any redemption in the end of the movie. :/ (Not that this trivial tidbit diminished my overall appreciation of a totally awesome film, mind you!!)