As I understand it:
Gally and Susannah are a couple at a time when that has to be concealed
Susannah invents a husband, Major Noone (i.e. No One), who she then says has gone to the front, and will shortly be killed, leaving her pregnant
Gally has persuaded her brother Newt to father the child. In the process she learns that her brother is not gay, as she had assumed; asexual is probably the label we'd use now. However, to please Gally and Susannah he steels himself to do what needs to be done, and Jerry's mother (whose name I've shamefully forgotten) is the result, and that's why she looks so like Gally.
We don't know if she ever knew the truth. She asked Newt if Gally was her biological mother and he truthfully said no, but I felt it was left unspoken between them whether she guessed the truth. She was an extremely intelligent and empathic person, so my guess would be, yes.
I absolutely loved this series. I plan to listen to all six episodes in one go as soon as I can.