Okay, I found the actual way to unlock her. First, Jade must be living in the manor and be level 19. To raise Jade to level 20, talk to her in her room. They will talk about a room that was locked. After unlocking it (this happens in the cut scene) they will find an egg in the room. The following Sunday, this egg will hatch into Lily. Initially, this naga will be small, but grow full size over time.