Is it true that a previous forbidden relationship displeases Allah, and He will not bless their marriage, even if they repent?

You both did well to repent to Allah from this unlawful relationship. Repentance expiates your sin, and you are not obligated to marry her; rather, you have a choice in that. It is not necessarily true that Allah will not bless your marriage if it takes place, especially since you both have repented. The Sunnah has encouraged the marriage of those who love each other. If the girl is convinced about marriage, then seek Allah's guidance (perform Istikhara). If marrying her is not facilitated, then look for someone else.