There are a lot of instances where Picard is clearly making up an excuse to get away from Lwaxana Troi. Here's one, from TNG: Menage a Troi:
LWAXANA: Oh, Jean-Luc! Jean-Luc! Come have a drink with me. Tell me what you've been up to.
PICARD: Perhaps later, Lwaxana. Mister Data and I were just about to show Reittan Grax the er, the er, the new door mechanisms on the aft turbolifts. If you'll excuse us?
Then there's another time when Picard invited Data to crash his dinner with Troi, and spent the whole evening getting Data to spout inane filler.
And she never seems to call him on it. Is she unaware of how people feel about her or does she just not care, preferring instead to force people to endure awkward social situations?
There was a single line in TNG: Haven where Lwaxana implies Picard was having erotic thoughts about her, but Deanna clarifies that she was only joking. So it's not like she thinks there's a chance between them.
Given Betazoids' penchant for brutal honesty between each other, does Lwaxana totally understand that Picard is trying to avoid her and is simply amused that Picard is going through the trouble of making up an excuse instead of just telling her to p*ss off like any other Betazoid would?