Pride Comes Before a Brawl - S1-E7
Continuity mistake: When Hercules and Nemesis are in the boat discussing her assignment, the shoreline behind Hercules doesn't move behind him as they speak (so the boat is lying still). But whenever the camera cuts to Nemesis, you see the background slowly moving away (so the boat is moving).
Answer: Most shows do flashbacks to show how things begin or what circumstances brought them to their current predicament. The modern episodes was to show how their legacies live on. Hercules changing his name to Kevin Sorbo and starring in a series about himself or Xena, her soul being reborn to continue her fight against evil.