It's a long time since I played Haro, and I only had dodgy ingrish translations from AGTH to go on. But as I remember, the girl is a wood nymph cursed tolive as a mortal until she finds true love.
The dude is questing for something too, I can't remember what, and the omens lead him to the nymph's cottage where she is bound to remain. He moves in and they start having an outrageous amount of sex, but for some reason they can never quite use the L-word, so the curse persists and the girl stays bound to the cottage.... and I never got much further than that.
There's a decent discussion of the game on Hongfire if you're interested.