wife calling husband "dad"

I'm married to a woman that is almost 10 years younger than me. She often calls me "dad", not "daddy" but "dad". Not in sexual settings. Often in the presence and context of in front of our kids, but often when it's just us. I know that she had a terrible relationship with her father and has a lot of anger towards him from childhood and has a very thin yet bad relationship with him now. I think that she has projected a lot of issues about him onto me. I also know that her first live-in relationship was with a man in his 30s when she was 18.
She's brought up on her own that she might project dad issue stuff onto me. I've asked her not to call me with the same pronoun she called her dad. She does it habitually, and I've started correcting her with "I'm not your dad", and she gets upset and takes pause for a moment when it's pointed out that she still calls me dad.
Am I right in thinking that she is projecting stuff onto me and viewing me as a father figure with issues? Or is her calling me dad just because I am the father of her children?
Thanks in advance for and insight or opinions. If there are more details that might help with understanding the situation please ask.

Oh gosh I thought couples did that a lot, especially with kids between them. My partner and I only have fur babies but we call each other momma and daddy all the time- as you said, in non-sexual settings.

In this case, maybe she does have daddy issues, maybe she doesn't. Personally it wouldn't bother me, either way. Especially if the only context is non-sexual. It seems relatively harmless.