What's with the gay rumors? How would any of this tie in to being gay? There's no evidence whatsoever that he's into guys.
Here's my best guess as to what happened:
There is someone Manti met who went by that (possibly) fake name. She approached him online and they began online correspondence. He did meet her in person, as did other players and people that know Manti. And she was introduced to them by that name.
For whatever bizarre reason, this person then fakes the illness and "dies," and he does not see her again. Perhaps the girl was money or fame motivated and decided to give up on the relationship or had the death thing planned all along.
Manti finds out somehow that it was a hoax and is humiliated and starts some series of lies to cover it up, asks others to participate and hopes it will blow over. He's pretty far in at this point, what with others having met her and articles being written, so he sees that as his only choice. To cover up the embarrassment with lies. Obviously...he fails miserably.
All guesses obviously. Bizarre either way.