Very nice. Now THAT would be a far more interesting encounter than what we've seen with the recent updates.
Also, while on the subject of incubi, Nennai stated awhile back that that one of his biggest inspirations for the Sinisistar 'verse was the original historical depiction of them, and they were not for the faint of heart! It's a shame he seems more interested in giving time instead to lesser, non-sentient monsters, though. There's only so much you can do with them...
Anyhoo! As far as I would go when implementing an incubus into the sequel, I'd set things up where Haanja has received word that several townsfolk in Arcezon have been going missing and, while that alone isn't anything noteworthy to report, it's where their last known whereabouts are. That being an abandoned manor within the town itself, not outside its walls.
So, Lelia is sent to investigate. When she gets there, she's confronted by a curious scene. The manor itself has been converted into a lavish brothel and as she moves from room to room she'll encounter several patrons enjoying themselves. One or two may even try to molest her if and when she gets too close to them, which she can simply fend off with her staff. Regardless, they're human, so there's no killing to be had. It's only when she reaches the master bedroom of the manor that she meets the cause for these missing reports. Rather she is confronted by an unusually handsome man who initially attempts to seduce her to bed but if she strikes at him he'll show his true form and we get our boss battle with the incubus.
Should Lelia not strike at him while he's still posing as the handsome man, we get a multi-stage sex scene involving them getting it on before he steals her soul and turns her body into an incubator for his offspring. As it turns out this incubus has been waging a secret war against the Otherworlders and their cult for some time now, quietly gaining power in the town in order to turn it against them once he has the numbers to take over the realm. Otherwise, should Lelia see through the incubus' disguise and force a battle between them, it moves between several areas. The first phase begins in the bedroom and if you're victorious there the incubus will retreat, forcing Lelia to give chase. Those same brothel patrons she had to endure earlier to reach him have since become aggroed as a result and you're forced to beat them down along the way.
Anyway, once you get past them, the incubus leads you down into the manor's wine cellar where you have your final battle, surrounded by the missing villagers, chained up, in varying stages of pregnancy to the incubus' seed. The incubus has since become even more beastly by then and, if you fail to defeat him, he definitely won't go easy on you like he would have in the master bedroom. Instead he kills you after some very rough sex, leaving your defiled body as food for his followers.
If we want to make this a truly epic showdown with the incubus, though, I'd have it that the manor is engulfed in flames once you defeat him, leaving Lelia no choice but to evacuate whoever she can before it's too late. Regardless, while much of the manor is lost after this conflict, you can still visit the burned out cellar and there remains the boss replay symbol. Yay!