My interpretation of that was extremely different: that Harry got riddled when he was a baby, in Godric's Hollow.

The problem with this is that presumably since Harry was AKed by adult Voldemort, his scar contains a Horocrux of adult Voldemort.

So if we are supposed to understand that the diary had some major effect on Harry, it has to have done it in a way that doesn't "mirror canon" much at all.

Well, EY often mirrors canon, while making certain changes for the sake of plausibility - for instance the philosoper's stone works differently. I'm not exactly sure why he would want to change the effects of possession, but I could certainly see him changing the way it works.

the Harry we see now is what you get when Tom Riddle's mind grows up in baby-Harry's brain, raised by his adoptive parents. I'm not even sure what the latter means exactly.

I suppose it would mean baby-Harry knowing how to walk and talk from day one.

The more I think about it, the less sense any of this makes. I mean, sure I can buy that Harry's scar is a Horocrux subtly influencing his behaviour. I could imagine that there are multiple entities in his head. But 'Harry' seems to be the primary. If he can't remember any of Riddle's memories, what does it mean to say that he is Riddle?