Larne, who beat Kosovan side Ballkani on penalties to reach this stage, took the lead in Faro last week courtesy of Matthew Lusty’s brilliant 16th-minute strike.
But they were unable to stave off a fightback from the Imps, who turned the tie in their favour with goals from Kike Gomez and Joe.
And while Lynch hopes to see his side energised by their home fans on Thursday, he admits there is “still a huge amount to be done” if Larne are to secure their place in Friday’s draw.
“They’re a team that have I think eight or nine internationals and they’ve played against bigger and better opposition than us before,” added Lynch.
“I don’t think this is a foregone conclusion by any stage. If we’re fortunate enough to come out of this on the right end, we’ve a huge amount of work on our hands.”
While qualifying for the Conference League would earn Larne a considerable financial windfall, Lynch insists that has had no bearing on his side’s preparations.
“We don’t get into that. That’s probably a different interview you need to have.
“Mine’s about what we need to do to win a football game. Regardless of whether it’s £2m, £10m or £15m, we’re going to prepare the exact same way.
“I think from the players’ perspective, it’s a prestige thing, that opportunity to go and play in what could be the biggest stage for them. That’s very much their motivation.”
Lynch added: “This is why we’ve worked as hard as we’ve worked. To get ourselves in positions like this and we’re expecting a full house and a noisy crowd and now we have to go and deliver.”
Having made their debuts off the bench in last week’s defeat, new signings Jordan McEneff and Benji Magee could make their first starts for Larne, but Sam Todd, Josh Seary and George Marsh – all of whom joined this week – are unavailable.