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1) Quality of life. This relates to the "luxury" stat. The higher the grade of a girl (slave - poor - commoner - rich - noble), the more "luxury" they demand. You can increase a girl's luxury in a few ways. Private room or your bed (some mansion upgrades make this give even more luxury), underwear/boxers, or the gold ring from the beasty northerners.

2) Fairy quest - definitely the biggest jump I think - second quest and you're fighting really high level guys. I find the wolves to be the easiest grind - they die pretty easily so you can get a few good fights in before having to rest.  Find them around Amberguard - one jump north from Wimborn Outskirts in the Forest has a bunch. Having 4 in your group also is a huge jump over 2 or 3 - taking the girls from Wimborn, buying (or capturing) a few good fighters will make a huge difference. I'd focus on getting a group of 4 at level 2 or 3, then go up and try to get a fairy. I find they either spawn as level 3 or 6. For this quest just capture a crappy level 3. Then go back and capture a level 6 because they have high magic and can become a good mage in your group, and reasonable to defeat with 4 level 2/3s because they're always alone.

Thank you!

Now when I get into fights, my captives are always horny, and I fornicate with them before I leave to grind but they always have that status effect during battle. What do?

Easiest way to control that is that when you fornicate with them, watch the red symbol. If it's white inside when you stop they're going to be left horny. Sometimes they still are anyway.

Otherwise letting them have a personal room or sleep with your bed will let them relieve themselves during the end of the day.

Also I haven't tested this, but does giving them a deterrent potion do anything?

lol I must have been lucky, shortly after getting a quest my starting location spawned a Fairy Teen lmao