You're right, the episode wasn't very accurate (because the main plot focused on Homer who is an hairdresser). The purpose of Taffy's character was just to push Lisa to show her hidden feelings for Milhouse, regardless of whether the boy still loved her or not.
However, according to my opinion, he still felt something for Lisa. maybe that feeling would go away if Taffy had not broken up with him. But I noticed that when Taffy has left him, he didn't try to win her back somehow, he was quite intrigued to find out why Lisa was following him.
But yes, the episode needs to explain...