i don't really see much to discuss here to be honest. It's great that you are having conversations like this together, and i think you should be comfortable enough to talk about past relations etc, it goes without saying. Yes, it's obviously a good sign, you know that.
As for appearances, sometimes when you see a photo, you only see whether they are pretty/average/etc, but it's only when you meet them that you see the attraction, i guess that makes attraction something you feel more than something you see, because it's their personality which shines through. I know someone, who if i showed you a picture of, you would probably think she was hot, but if you had to meet her for one minute, you would find her very unattractive, same goes the other way. There is one friend I can think of in particular, who is nothing special when you see her in pictures, but she is the most awesome person, and after knowing her I can honestly say she is gorgeous. And there are plenty of other people I know who can fit into these examples.
Are you bothered by the fact she didn't find you really good-looking at the start?