Plot hole: When Buffy enters the house to rescue her mother she uses a stake to stop the front door from closing. A vampire then grabs it and the door closes. Why did Buffy use a stake knowing that there was a vampire there when she was almost killed by a vampire with her own stake earlier in the episode because Giles had been injecting her with a muscle relaxant?
Plot hole: Healing Angel requires draining the blood of a Slayer. Buffy tries to kill Faith in order to get some of her blood but Faith gets away after Buffy stabs her at the end of "Graduation Day Part 1." The amount of blood on the dagger that she used wouldn't be enough blood to heal Angel, but it'd be a start. So why didn't Buffy just use some of the blood on the dagger? In the very first shot of "Graduation Day Part 2" we see the dagger coated with the stuff.
Plot hole: In 'Graduation Day pt 2' the Mayor has his vampires stand at the bottom of the steps leading out of the school to stop any escaping students. The thing is, all the parents managed to escape out the side exits. Since the Mayor was expecting all the students to try and run too, why didn't he have these exits covered? (00:33:15)
Chosen answer: Angel is saying that he is still jealous and Buffy recognizes that this is his way of saying he wishes that they could be together. That is why they both smile.