The prosecution put it to Melanie Smith that it would have been the easiest thing in the world for her to set the pushchair outside her flat on fire, before returning to bed.
Ian Murphy QC alleged that Miss Smith was beginning to make serious threats towards her neighbours by mid August last year.
He said the defendant "spoke nastily" to Lee-Anna Shiers about her music being played too loud.
Accused of starting the fire, she replied: "I never ever did it, you'd have to be pretty sick and evil to do a thing like that."
Melanie Smith denies murdering five members of a family, and one charge of making threats to cause harm by fire, and the trial continues.
More top news
The Welsh Government has u-turned on its decision to scrap its youth bus discount scheme.
The rain will become heavy for a time in the west and winds will strengthen, but temperatures remaining mild for the time of year.
Jordan Matthews has been sentenced to life in prison, minimum term 18 years, for the murder of his girlfriend, Xixi Bi.