The other suspect during the investigation had worked with Mrs Lundy and lived near the family.
The jury was told yesterday the man had allegedly stalked a colleague of Mrs Lundy and been involved in a violent stabbing incident that resulted in him having psychiatric help.
Under cross examination by defence lawyer Ross Burns today, Ms Curran told the court the police application for a sample of bodily fluids noted the man had a history of psychotic disorders.
He also had a criminal past that included assault charges.
His psychological health had deteriorated since 1996 and he was admitted to a mental health facility after suffering psychotic symptoms including paranoid delusions that convinced him someone was trying to kill him, the application said.
Ms Curran said there was a suggestion on the application that the man disliked Mrs Lundy.
His alibi at the time of the murders was that he was at home with his parents, but they could not be sure he was there for the entire night.
Also giving evidence today was defence expert witness Marielle Vennemann.
Under cross examination by prosecutor Philip Morgan via audio-visual link from Germany, Dr Vennemann accepted that trace evidence of animal DNA found on Lundy's polo shirt was "hugely less" than the amount of Mrs Lundy's DNA that was also found there.
Mr Morgan also pointed out that DNA from two unknown males found under Amber's nails was "unremarkable", because they could have been picked up when the 7-year-old went to school that day.
"It could be unremarkable, we just don't know," Dr Vennemann said.
The Crown case in front of Justice Simon France is expected to finish early next week and defence witnesses are due to give evidence for the rest of the week.