This is a fairly common problem. I think it may be even more common in some of the smaller breeds that can be quite strong willed. Perhaps you have read in books that a dog will not foul its sleeping quarters. Well neither your Pug or many other puppies seem to have read those books. My guess is that she is punishing you for leaving her alone. Being left alone is the worst thing a new puppy can imagine. If you stand your ground, she should give up soon. Since the divider isn't doing much good, you might remove it. My experience is that no matter what size the crate, new puppies spend all their time next to the door, fouling the crate there, and then lying in it. She may keep herself clean if you give her a chance.
If I remember correctly, the Midwest crates are the wire ones. I prefer the more enclosed, den like plastic ones. Skip the bedding. At first it gets wet, and later it can be chewed into choking hazards. A wire rack in the bottom will help keep the puppy up out of accidents at first. They are available with the crates, but a piece of closely spaced wire closet shelving from a home supply place is cheaper. If you already have a metal crate, covering it may help. Just make sure you use
Something the puppy can't pull in and chew. Another thing you might try is the wood shavings sold as bedding for small pets. Be careful, she may eat the shavings.
The "shut the puppy in a safe room" is a fallacy. Very few houses even have a
Safe room. How many of us have a room with a hard surfaced floor and nothing
Else? Most rooms have electrical cords to chew if nothing else. In addition
To destroying anything a bored puppy finds to chew, it may choke or have
Intestinal blockage from the pieces. I had a friend that left her dog in a
"safe" room. It ate a hole in the floor covering. The safe rooms fail to
Give the dog the comfort of the enclosed space their instinct requires. Nor
Do they restrict activity extending the time the dog can go without relieving
Itself.
You must stand firm on this or she could end up running the house. This is not necessarily the breeder's fault. Some dogs are just very strong willed. Even litter mates can have very different personalities. You must give her proper leadership. The dogs see all the
People and dogs in the household as a pack with each having their own rank in
The pack and a top dog. Life is much easier if the 2 legged pack members
Outrank the 4 legged ones. You can learn to play the role of top dog by
Reading some books or going to a good obedience class. A good obedience class
Or book is about you being top dog, not about rewarding standard commands with
A treat. Start at
http://www.dogsbestfriend.com/.