I voted yes, let Eddie take the toys...as long as you and your wife are the top dogs and he allows you to have whatever you want, when you want it. If Eddie were stealing food and treats from your other doggies, then I would intervene.
I love Jillie's fake-out, diversionary tactic.
When I first brought Teddy home and Max was jealously guarding piddle pads, beds, and people (oddly, not food or toys), I had to find creative ways to provide for Teddy while making Max think he was getting his way.