Incest is a powerful dynamic that leave lasting scars and many residual feelings. The revelation and story behind it is disturbing for a variety of reasons. First is the chronic nature of the situation. This isn’t an event that happened, but rather an ongoing situation that took place over a period of years. This means that the home they grew up in was most likely poorly monitored — with parents who were negligent of their children’s safety. This, too, has a tremendous impact on their psyches as the situation evolved.
The fact that your fiancé feels bad and that he carries around the guilt and turmoil that comes with this will certainly affect your relationship. I do not think this issue is something the two of you should try to manage on your own. A professional therapist with some experience with incest would be helpful. You can find someone from the find help tab at the top of this page or this group who may be able to guide you.
Finally, your fiancé’s statement that he: “didn’t do anything but have intercourse with her…” is very telling. It is an attempt to minimize the impact of what this is.
As your plan was to marry into this family, I highly recommend couple’s counseling with someone from the above-mentioned resources to unravel your feelings, his issues, and the secrecy that has surrounded all of this.
Wishing you patience and peace,
Proof Positive Blog @ PsychCentral