e. refers to him raising his head/eyes in response to the goading (contrasted with just ignoring it). "the last time" means "on the previous occasion (when)".
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As far as I can tell, "looking up" is literal, i.e. refers to him raising his head/eyes in response to the goading (contrasted with just ignoring it). "the last time" means "on the previous occasion (when)". "that" at the end of the sentence refers to some taunt previously mentioned.