It's called baby-talk, and aside from the fact that it sounds cute, or rather adults think it sounds cute, speakers use baby-talk;e.g., "dood" because they assume the child won't understand "good".
A case in point, my niece, Danielle, who was all of two years old at the time, pronounced her name as "dough-dough". When we called her "dough-dough" she would correct us saying, "No! My name's "dough-dough!, not "dough-dough!" Of course, both her "dough-dough"s sounded the same to us, but not to her. She could hear the difference between "dough-dough" and "Danielle". She just couldn't articulate the sounds in "Danielle" yet.