You're right about the variables.

Just add an instance variable to "CharacterCollision" and call it whatever you prefer. Set it to numerical since from what I've seen boolean seems a bit lacking (or I just got unlucky and it didn't work well for me). Replace your crouching event with one that states "When Platform is on floor" and "When down key is down" and use the actions you already have (the animation and size changes). On top of those also add an action that sets your instance variable to 1. Then add a sub event that makes the character stand up, for example when pressing the down key again, and set your variable to 0.

For all actions that the player should only be able to do when crouching put a condition "When Variable (whatever you called it) = 1"

For all actions that the player should only be able to do when standing put a condition "When Variable = 0"

This will prevent any weird instances of conflicting actions. For example, your character jumping while crouched.

Hi. I'm very new to Construct 2 so sorry if mine isn't the best solution, hopefully somebody with more experience will come along and help with your query or vouch for my solution.

From my point of view an easy way to do this would be to make an instance variable called "Crawl". Just set it to 1 when the down arrow is pressed and then you can call on the animation group that relies on "Crawl" being set to 1. All other animations would play when "Crawl" is set to 0. You can add a condition that states that the character must be on the floor to avoid weird instances of the player crouching in mid air...unless you want to allow that for whatever reason.

On a separate note I'm a bit confused why you used "On Down arrow pressed" to start crouching instead of "On Down arrow is down". The former would make it so when you let go of the down key the character would still be crouching but the later would stop the crouch as soon as the key is released (which is what I assume you want to do based on the very last event). Then again maybe you tried that already and something went terribly wrong.