The original form of the name seems to have been Lurline, which as far as I can determine was invented for the opera
Lurline, music by
William Vincent Wallace and words by
Edward FitzBall, first produced in
London in 1860. I can't find any reference to
Wallace & FitzBall having based the opera on an earlier work which used the name Lurline. Their story, however, is obviously based on the
Lorelei legend, and the most logical explanation is that they were "modernizing" the name
Lorelei to "Lurline" to fit in with the names of characters in other popular English operas of their day, such as Balfe's
The Bohemian Girl, for which
Arline was invented.
http://www.oldandsold.com/opera/opera-17.shtml