SPOILERS
I think the ending showed that the rehabilitation project wasn't about using the Sensifier as a way to create sensible beings for inmates to interact with — but instead to create "hearts" for them that mimic human compassion. Danny sees his crime with the heart that's been instilled in him and kills himself for it, calling his past self heartless. Dr. Morris's idea was a success!
That explains why they both say, "Not then. But now."
I also think Candy's appearance was deliberately made to look like his victim, as if to put inmates to the test once more.
And if we go back to Danny's conversation with Candy, he asks her something along the lines of , "Do we treat others the way we do because they're human? Or because they have feelings?"
In Danny's case you could say that though he's human, he's also an unfeeling murderer. The objects that are Sensified, like Candy, pose the opposite dilemma; they're not human originally, but by all means they are sentient and feeling. Making Dr. Morris's idea also very unethical 👎
But then I think it's interesting to try and implement artificial feelings within a killer. Does that really make them rehabilitated citizens, or not? Super meta of Danny to even consider.