I like the cliff-hanger! Not really sure who Hui is a decendant of (400 years is a lot of time for blood-lines to cross), but i would bet that luna's family would be the most likely to keep various eccentric stories around, if for no other reason than pure entertainment. Based on her reaction to harry's fall, i'd say that she's either magical or was raised where magic is used. If i had to guess, i'd say that after the fall she did some research and braught harry to the Jade Dragon as a kind of subtle test. Once again, i really like this story and look forward to any update.
Author's response
Your dead on with the test at the Jade Dragon. The bar is charmed like the Leaky Cauldron. Only a witch, wizard or squib is going to notice the place.