The bouquet itself may well come from the bunch of flowers and herbs that richer people carried in the Middle Ages. Different kinds were known as posies, tussie-mussies or nosegays. (The Queen still carries one on Maundy Thursday). These were meant to keep away noxious smells and poisonous miasmas that caused disease.
The pure white Madonna lily is heavily scented. It is associated with the Virgin Mary as a symbol of innocence.
Even so, many people won't have it indoors because it reminds them of funerals; before embalming, mortuary chapels and refrigeration, its powerful perfume was used to mask the smell of decay.
Similarly, the Calla or Arum lily can have a strong scent. In frost-free parts of America, it is grown on graves as a sign of resurrection.
It was popular in the '20s and '30s in bridal sprays - very glamorous and Hollywood together with dropwaist satin dresses and headbands.
Finally, the name always makes me think of Lily Munster. I thought Yvonne de Carlo in the popular comedy of the 60s The Munsters was very beautiful in an eerie way.