No, frankly, Alipang _won't_ be all right. Absolutely deprived of anything remotely like romantic relationships, he had gained a lot of emotional nourishment from his affectionate relationship with Chilena, _without_ intending any of his kissing and cuddling of her to be inappropriate. But now Chilena, entirely by her own initiative, backs him into a corner, _asking_ him how he would feel toward her if they weren't related; and then when he _tells_ her what she _asked_ him, she reminds him that they ARE effectively brother and sister--as if he hadn't known that! To him, this is just like Kim treating him as if he didn't know subjects which in fact he knows _better_ than Kim does. Only coming from Chilena, it hurts a thousand times worse.
All you CAN do now is leave him alone.