The coronial inquest into the 2019 death of Lachie Jones continued today in the Invercargill District Court.
Coroner Alexander Ho is conducting the "fact-finding exercise" after police "missed steps" in the initial investigation and concluded the toddler had drowned.
She said the toddler was blood-related to her and they had a special bond.
"He was a happy wee boy, funny wee boy. Usually quite entertaining," Ms Thurston said.
Lachie’s parents had previously separated, and after their son died tensions were high, the court heard.
Ms Thurston said on one occasion as Ms Officer was walking away from a conversation she said Lachie had "done me a favour".
"She was frustrated, in shock, frustrated with [Lachie's father] Paul," Ms Thurston explained.
The witness believed Ms Officer said it because the boy's death would mean she would have less to do with Mr Jones.
On the evening January 29, 2019, Lachie and his mother popped into Ms Thurston’s house.
Ms Thurston said she saw Ms Officer, but could only hear Lachie - however she was sure he was there.
"And then the next thing she said ‘s*** he’s gone again’ and Michelle left," Ms Thurston said.
Later when Lachie went missing, the witness helped search the neighbourhood but initially they stopped at the gates in front of the oxidation ponds.
"As a little boy I thought ‘nah he wouldn’t have got over that," the witness said.
When Max Simpkins, counsel for Lachie’s father Paul, was questioning Ms Thurston he reminded her that she made a call to a detective inspector.
She explained she had been thinking about the night Lachie died and she remembered finding a cannabis cigarette butt in Ms Officer’s garage, which the two women smoked.
"I lit the butt and we both had a very small puff of it," Ms Thurston said on the phone call.
She explained she later called the detective back and said she must have been wrong as she was working for a psychologist at the time so was not using cannabis.
Mr Simpkins also pointed out inconsistencies between Ms Thurston’s evidence yesterday and her initial police statements.
The witness said at the time she did not understand how important her statements would ultimately become.
"I didn't realise this was going to become such an intense situation," Ms Thurston said.
"Parts of the night are not things I really want to remember."
When questioned by counsel for Ms Officer, Beatrix Woodhouse, the witness described Ms Officer as "a good mum".
"She was always there for him . . . if you saw Michelle you saw Lachie," Ms Thurston said.
This afternoon another neighbour Maxine Cartwright was in the witness box.
She initially told police she saw a "little person" wearing a high-vis jacket and a police hat run past the window at her neighbour's house where she was.
Ms Cartwright, who was 14 at the time, told the court that her memory of the night was now quite unclear.
The witness admitted to Mr Simpkins that she was initially confused about who she saw and that it could have been a different neighbour.
She said because she only got quick glimpses of the child, what she said in her statement could have been influenced by what other people said about what Lachie was wearing.
"I believe that could've definitely happened. The discussion with others could have altered my statement at the time," Ms Cartrwright said.
This afternoon, one of Lachie’s half-brothers Cameron Scott will give evidence.
