Well thanks Michuck and Dan. You too Little Robyn.
After reading Midchuck's response, I googled Loop and Lil and found this:
"He says that the lyrics were changed in the Emmylou and Doc Watson version to "Who could ill agree / she's a site to see / and a treasure for the poor to find." The original lyric was "Loop and Lil agree" and Loop and Lil were Townes' two parakeets. Loop was named after the North Loop drugstore in Austin where they used to buy codeine cough syrup and Lil was named after a girl Townes knew."