She's certainly adorable!
I don't know about the towel thing.. that's an unusual way of taming birds I'm not familiar with. I would just go slow, offer your hand, and see how she reacts. As a baby, she could give you a good pinch but she's not likely to bite hard enough to break the skin. I'm unsure about the cream of wheat as well... again, seems strange but if it works...
Offer soft foods, veggies, fruits, you can offer soaked pellets, etc. What was the breeder feeding her before? It's best to offer that.
Do you happen to have a postage or food scale? Your best bet to monitor how well she's eating is to weigh her every morning before offering food and after a poop (if possible). Any weight loss greater than 10% of her body weight is critical and she would need to go to a vet ASAP. More important than food is water consumption. Make sure her water dish is easily accessible and she's drinking. Since she's young, it may be worth putting a towel on the bottom of the cage (in case she falls) and putting a shallow food and water dish down there as well
Does she make a noise when she does her open beak thing? Baby conures looking for formula have a distinct little baby chatter, you can hear it in this video.
YouTube - baby sun conure chicks @50,52&54 days old
It almost looks like a threatening posture and since your breeder wants you to towel her, I'd be afraid she might be a little nippy or fearful. Most people only towel aggressive birds...
My only concern, not to be a debbie downer.... she's really brightly colored for a baby. Usually, sun conures are a really dusky green shade and rather mottled till their first molt around 8-10 months. You can see the green mottling in the babies in the youtube video. Does she have a band or a certificate to verify her age?