Revealing mistake: The picture of Marissa and Ryan that Oliver hides is from the pilot episode, at the fashion show hosted by Marissa. However, at the time she and Ryan barely knew each other and wouldn't have an excuse to take a photo together.
Continuity mistake: When Oliver is singing along to "It's Not Unusual" by Tom Jones and is dumping all the pills onto the coffee table, the pills go from being all mixed up to in colour co-ordinated piles, and back and forth.
Continuity mistake: At the start, Summer and Marissa are talking about the weekend. Summer says something like, "I'm going mad over Seth Cohen." The camera swaps from Summer and Marissa. We see Summer first with her hair in front of her ear, then when we cut back after seeing Marissa, Summer's hair has gone to behind her ear.
Answer: She is referring the episode entitled: The Best Chrismukkah Ever, episode 13, season 1. She goes out christmas shopping with Ryan and gets stopped by a security when she is out by Ryan's car. He asks to look inside her bag and finds a stolen watch and some other stolen things.