Aw man, I had a long-ass post written up, but the board ate it. But maybe that's a good thing, it'll force me to summarize for once.

Alright, here's the gist of it, sorry if it's a little terse.
(Two dozen red roses costs about the same as hiring a goon squad to spy on all my girls for the next two years - she damn well better fall in love with me at that price!)
Oh, expensive stuff needs to be effective, I wouldn't debate you on this. The main issue was that the stuff which was meant to increase love slightly as a side-effect was way too good at it on account of its price tag. With the old gowns for example, you paid for charisma, but you were meant to get a little love and happiness on the side, as opposed to the dresses where you paid for charisma and got bonus libido. But with the high-grade items, both gowns and dresses give craploads of love, so the nuance was lost. (Gowns don't give love anymore, because girls can buy them for themselves. I made them cheaper per point of charisma to compensate, but I will probably specialize them somewhere down the line to make them more interesting and useful.)
Hmm. I think giving items which don't have any inherent love or happiness boosts should still make the girl happy and boost her love, personally. I do agree that the current rates are quite ridiculous, though.
Perhaps, for the time being at least: cut the increase to 1/10 of what it is now, with a further 5% reduction for every point of badness the item has (ex. 19 badness = 95%)?
That way, an item worth 5000 gold would give 10 happiness and 9 love (assuming item badness of 0).
The mechanic itself is a good idea that makes sense, but the numbers on it were clearly meant for the old items which had a generally lower and narrower price range. Your reduction proposal makes sense, though maybe I'd set the reduction to 1/4 instead of 1/10 so it's still relevant on the less expensive items. Either way would be an improvement, though. And in any case it's good to have a peek into the love system mystery box, so thanks for digging that up!
The only trouble I forsee is catacomb items, which are sometimes valued at over 10000+ gold. The badness modifer sounds like a good way to keep these items at their intended effects without drastically changing anything.
Yeah. The thing with the price of catacomb items is that it needs to be high enough that if you find something good that you don't intend to use, you can get some decent cash out of it so it's not a total bummer. (Plus I like the idea that if you're in financial trouble, you can pawn a powerful artifact and keep your operation running for a few weeks at least; it's almost like an extra life, heheh.) That said, now that we know exactly how the system works, at least we can put -love effects to keep it in check if it seems appropriate.
Haha, I still made a long-ass post. Can't keep a writin' guy down, I guess.