I think he was talking about Xiao Fan. What Huo said to Lady Sun was to trick her to leave and kept her alive, but his real love is the one who's beneath the tree on the hill, most likely refer to Xiao Fan.
"The ospreys cry on the islet in the river" is the first 2 lines of an old poem "Guan ju", which has quite a bit of history behind it. There're many different interpretations to the poem, some interpret it as an eternal, faithful love story between two persons: a gentleman and a fair maiden, fittingly and ỉonically relates to Huo and Xiao Fan.