It's essentially you being shy/oblivious about your own feelings. It's a common thing in IFs like this to provide both a 'bold/direct' and 'shy/oblivious' option, which allows you to form a romance with a character in both ways. This helps for people who want to romance a character but don't want to be a flirt, and the player can still be 'pursuing' a particular character's route, but they are permitted to be shy about it, to be the 'pursued' instead, in some cases.
Hit the nail on the head. I appreciate the options, as I usually don't like to play the obvious flirt. Or I can start with oblivious flirting at the start that progresses to bold flirting once the MC grows more confident in their growing relationship with the other character.
Or in this case, Mordred is still a young kid who hasn't yet hit puberty. Starting to like and be drawn to Galahad, but not yet aware that their feelings are the beginnings of a future romance.