Mmm that feels like a pretty big stretch. The whole point is that Fiona loves Shrek for who he is, not what he looks like. She didn’t become an “ugly green person”, because she was beautiful to Shrek and Shrek was beautiful to her.

Also, even if the idea was short=ugly (which I don’t think it was, more just a king with a big ego and small stature), Shrek 2 is completely centered around Shrek feeling insecure next to what turns out to be a conventionally attractive bad guy.