I believe she was the daughter of a Squire from Derby named Thomas Pegg. Catherine is also said to have had a daughter named Catherine Fitzcharles who was placed in a nunnery and died young. The son was made a duke and died in the Battle of Tangiers at age 22. I think the descendants of Thomas Pegg fared pretty well in Derby after Catherine's daliance with the King and were lords of a manor in Derbyshire. Try a search for Strelley Pegg and you might be able to fill in some of my blanks as I am reporting from memory.
Does anyone know anything about any early Quaker Peggs in England or any Peggs in the Lincolnshire area?
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