I like what you're doing here, but I can't tell if it's too long, or too short.

Either it's a short story, in which case, you're going to have to determine the single narrative arc that captures the most impact, and leave the rest in the background. If a story is well formed, with characters engaged in activities that readers find compelling, you can leave a lot of the back story on the cutting room floor. They don't really need to know it all. You do, of course. You have to know everything about your characters' universe. But if they behave in a way that is consistent with the parameters of that universe, much can be intuited without you having to take the reader by the hand and spoon feed them all the supporting details.

It would be a simple thing to let your readers know that this is not a true historical setting, although it might well be a kind of universe-next-door, one that seems like ours, but isn't, without going into great detail about the origins of the people. It would be easy to convey the danger that surrounds the lake, and the taboo nature of your couple's developing relationship. Choose the details that count. Deal with the others through brief exposition, or let them go. Leaving empty spaces in your narrative can offer the reader room to sort of climb inside and apply their own interpretations.

On the other hand, you have a fairly broad scope to your narrative, one that your brief novella structure scarcely begins to encompass. You seem to be in a hurry, when what is called for is a steady, incremental revelation of your characters' evolution. For instance, this passage,

Jacob told not a soul about the ice-maid, not even his own mother. He decided that it was wise to keep such supernatural encounters to oneself, for even mentioning his interaction with a mystical creature was enough to dispatch a war party. Besides, he was never close to his mother, Alda. Even so, Jacob possessed a great quantity of willpower for a boy of ten and six winters. He now took great detours to the lake, on every water-journey. He often told Alda that he would be fishing as well, from a different lake, to delay the time of his expected return. He would often sit with the ice-maid, and converse about various things. He would tell her about his life, and she would tell him about the lake. Sometimes, they would sing together, letting the strange song of a mermaid and a boy float across the frozen lake and soar through the wintry air.

You've cheated your reader out of at least two chapters, possibly more, of necessary development in that brief paragraph. Notice these red flags:

He would often sit... He would tell her about his life and she would tell him about the lake. Sometimes they would sing together...

There are no actual events here. Note the number of times you use the word would. These are conditional statements, as in, If these conditions are met, then these types of activities would tend to result.

Stories are not about a class of activities. They are about specific activities, not things that would happen, but things that do happen. In sequence. One thing after another, each one resulting from decisions leading to actions, which cause further decisions and more actions, for as long as you can continue spinning out plot points.

You mention that Jacob had a great deal of will power. Much better to show him in action demonstrating his willfulness than for you to simply tell us about it. You need to get out of the way, stop helping your characters out and just let them get on with the business of showing us their story. Of course, this will mean a lot more text, but it will also be much more compelling.

So, too long, or too short? That's up to you. Either way, you have a solid core from which to begin your revisions, and a nice bit of imagination to help you along.