Looks like you started reducing too late. As you move out from your original circle the amount of additional stitches required for a doily are less for a beenie. If the hat doesn't curve nicely then the pattern is calling for too many additional stitches in each round. At the end it looks like the additional stitches were stopped all at once giving you a suddenly straight edge. Like you might use for a basket. You could always start reducing at this stage and use it as a beret. Although the sides are already too long for a beret.
I would rip out to about the 4th row and use a few less stitches in each succeeding row. That will correct the problem. Once you've done a few of these you won't even have to follow a pattern you'll know, by the curve of the hat, as your working what to add to get a nice form fit.
It's supposed to be a cupcake beanie. The striped part is the icing and the brown is the flavored part of the cupcake. I used this video on YouTube for directions, but I don't have a physical pattern for you to look at. The person in the video didn't say anything about decreasing, but had me increasing at different intervals. I used a size J hook and cotton yarn, if that makes a difference. I asked her about the flat as a pancake issue and she suggested I try a smaller hook and it should shape as I go. Whatcha think?
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