Man this has some incredible polish for a game jam! The addition of the little character really adds to the overall charm, and the general aesthetic and presentation is just fantastic. Some great juice with the words highlighting and exploding as well, especially once you've racked up a decent score multiplier.
I like the idea of "failing" to create words adding to a score multiplier -- it adds a good risk/reward dynamic that keeps the game interesting -- but I feel it's foiled a bit by some of the blocks already containing three-letter words that automatically trigger and break your multiplier. The RNG aspect of what letters/blocks you get could also be a little frustrating at times, but on the other hand it also adds to the replayability -- if you were to expand on this in the future, maybe being able to "save" a single block for later could help with this.
Overall, honestly the best submission I've played so far, and there were a ton of great submissions. Fantastic job!