I can't resist putting my 2 cents into this discussion even though it is nearly 4 ½ years old and the people who discussed it before are probably no longer paying attention.
The reason the "miller" used body parts to make the harp was because he was really a sorcerer who was deliberately trying to build a MAGIC harp. He succeeds. In the oldest versions of the song, the harp speaks (or sings) and names the killer, who is then gruesomely punished.
Therefore, he probably didn't need to make the ENTIRE harp out of body parts; he only had to incorporate certain parts into the harp somehow.
We don't know why he wanted a magic harp. He may have intended to expose the killer, or he may have had some other purpose in mind, and the naming of the killer was an accidental consequence.
I suspect the legend comes from a time when ordinary harps were believed to have some magical influence over people who heard their music. Maybe the miller/harper/sorcerer was trying to augment that power by magical means.
Doesn't "Jack and the Beanstalk" involve a talking harp?
I wonder how Jen's story came out?
By the way, there are a HUGE number of threads on the subject of one or more versions of the song TWO SISTERS. I am compiling a list of them, but I don't quite know what to do with it yet. Any suggestions?