This contains dialogue directly from the book 'The Sandman and the War of Dreams' by William Joyce, everything else is my opinion on what might have been going through Pitch's head during his reunion with his daughter.
...
The emotions breaking free inside Pitch were crippling as they battled against the cold he'd embraced for so long. Feelings he'd hidden, a pain he'd escaped through sheer brutality, a love he'd lost and beaten down to the very depths of himself - all were returning to the forefront of his heart with a searing intensity.
Her face was both a balm and a dagger for his soul. A face he had not seen, had scarcely hoped to imagine in his wildest of dreams, for centuries. How long had it been, he wondered, since he last laid his tired eyes on his little girl?
"You saved me," he whispered with difficulty, pride a heavy weight for his shriveled heart to bear.
"No," was the immediate and vacant reply. "It was the girl who saved you. The one who you would make your Darkling Princess."
For so long, he strove for only darkness, for only anger to dwell within his heart. It had been like a dark shell, effectively concealing from him his mourning heart in exchange for his soul. With each hard word, that shell was breaking. At some point Pitch had collapsed to his knees, weak from the ache burning within him.
"Had you forgotten me?" the women that was no longer Emily Jane demanded. "Your own daughter!"
"No!" he cried in earnest, his eyes desperately memorizing her face - still not quite believing, still afraid to hope. "I never for a moment forgot you."
"Then why did you not come for me?"
"I tried!" he urged her to believe, his desperation giving birth to panic as emotion so strong overtook him he was physically sick from it. "I tried... For so long, I tried-"
The threat of tears halted his words, and the resounding silence that followed was like a spear piercing his chest. The air around him grew colder, but he hardly paid it any mind. His only focus was his daughter and the slow death she was dealing him.
"You failed me, Father," she said, cold and cutting. "I was lost. I had nothing but my rage at you to feed me. I came to your aid only out of... curiosity. To see how a once-great man could become so fallen and low."
No. No, no, no, no, NO! The pain, the hope, the fear, the rage, the yearning, the envy, the pity, the love - the torrent of overwhelming emotions turned into a violent symphony of white noise as it overtook him and split him apart. He crawled to her, his hand stretching out through the noise and the pain, trying to reach her.
"You will receive only indifference from me, Father. I will neither hinder nor help you," she told him. "I demand only one thing for my neutrality: You cannot make this girl yours. Not ever. Leave her be, or I will destroy you. I am your only daughter, for good or ill."
He wanted it to stop, to end. Like so long ago, he was at war with himself, fighting a losing battle of wills. The pain was too much, the emotions too real. For the second time, Pitch allowed himself to fall into the darkness - to envelop the cold numbness of depravity.
The welcomed calm of insanity returned to Pitch. As he gazed up at Katherine, her small face twisted in fear, he could have laughed at the irony. He had spent centuries without a conscience or emotion to avoid the loss of his family, and when he finally reunited with that which he had craved so entirely, the emotion of her rejection was to painful to bear.
"Yes, my daughter," he murmured, plans already developing in his head. "I will not touch her."
He had faced his emotions and realized his desires buried deep within himself. He would destroy the Guardians, he would destroy the Man on the Moon, he would destroy every peaceful thought on this Earth.
Except her.
