I don't think other girl's a tool just because she wants someone to stop pursuing her because it's her friend's ex. Sometimes it's a respect people afford their close friends, even if one of them's crazy. I wouldn't date one of my friends' exes no matter how much we may be right for eachother. They are my friends first, and my loyalties lie with them foremost.
In this case, he only said she is the younger sister of one of his exes friends, not a friend of her herself.
On the other hand, she might just not want to deal with the drama that may ensue, and that's her choice as well. She also has to take into the account that her sister might lose a friend if she did this, and that consideration is also admirable. A girl who's willing to forsake her family's happiness at the drop of a hat for someone else will undoubtedly be able to do so to that someone else in question as well.
If he wants to see if he can change her mind, he should, especially if he thinks she's worth it. No one wants to go through life thinking "what it?"
Sometimes these stories go like this: blink, and you'll miss it.