We're engaged, and yet she refused to kiss me.

Literal

Engaged-[continuous-ている] [despite-のに] kiss [object-を] was-refused-[passive-された].

A rueful complaint. ~のに ('even though, despite') marks a surprising or disappointing contrast. 婚約する ('to become engaged'). 拒否する ('to refuse, to reject'). The passive 拒否された puts the speaker in the role of the one being refused — a common use of Japanese passive for adversarial situations (often called the 'suffering passive').