One should say as simply and directly as one should. There should be nothing to fear if there is love for love understands perfectly. At the same time one should have the courage to stand up for the person we love. In any case one should not keep the other person in dark even if expressing inability to marry may imply that the person may walk away. Love cannot be selfish and one should think of the other person whose expectations might have been fanned. It is better to clear what is possible and what is not possible in the beginning itself.
Affectionately,
Alok Da