I found his story a little sad, but when i was given the option to tell him she's dead or lie to him to make him feel better, i told him she was coming back soon, at least he will be more at peace than if he knew she died...

What about you?

closure. had to. couldn't string him out and prolong the inevitable.

I didn't tell him anything. I stuck my Ebony Battleaxe into the back of his skull, totally oblivious that he had a related quest at all until just now.

Did exactly the same thing but...(even though its a game) I felt sad afterwards and actually thought of reloading after an hour

I don't think it matters as the reward is always 3 random alchemy ingredients. This, like so many "options" in Skyrim, doesn't have any real impact in game terms, just in your own emotional terms.

This quest is also all sorts of buggy. If you find the necklace before talking to Narfi or the innkeeper it breaks the quest. If you talk to the Innkeeper after finding the necklace you get an option "Have you seen this necklace before?" and the innkeeper says a line that was clearly meant to be spoken by Narfi.