Corrected entry: In the beginning of the episode, Khan makes Connie's friends sign a contract when they come over for Connie's sleepover. Despite being an intelligent man he should know that even if a child signs a contract, it is null and void unless the child is with a parent or legal guardian. Khan might be rash and strict but with how seriously he takes these contracts it seems doubtful he would forgot something as important as a minor needing an guardian to sign an contract. Evidence of how serious he was about the contract that a little later in the episode, he even takes away the girls pillows when they are fighting in order to avoid anyone getting hurt. Then after this one of the girls makes a comment how Connie's dad made her pay for breakfast.
Correction: Khan thinks he's smarter than everyone else in town. And considering that it's Arlen, he's usually right. He thinks they're dumb hicks who would never think to talk to a real lawyer about it and find out he can't do that.
The Bluegrass is Always Greener - S6-E10
Corrected entry: Watch Dale's finger; his keyboard playing does not match the actual bass notes being played.
Correction: In the "propaniacs" episode it is shown that he has no idea how to play the keyboard and that he just fakes it and goes with the pre-recordings.
Correction: You have completely missed the point of the situation. Khan is a control freak and he is always pressuring Connie to become a success i.e. "Bluegrass is Always Greener on the Other Side". He comes up with the idea of a special contract, which is only valid in his house and does not apply in any legal system whatsoever, as a means of preventing the other girls from making his daughter a stupid party girl.