I'll say this right off the bat, this is a fantastic episode. It's still not as good as pt 2 but. What I love about this episode is we get our first glimps into the history of Angelus/Angel with some fantastic flashback sequences.
We get to see where it all begun with Darla giving birth to the vampire Angelus. We get to see how sadistic Angelus really is as we see him hunting down Drusilla and driving her crazy. Also we witness Angelus in Romania being cursed with a soul by the Kalderash clan.
Revealed to us is how Angel ended up in Sunnydale, with a flashback showing the new character Whistler coaxing him into helping out the slayer.
Outside the the flashbacks we see a tomb that has been unearthed containing the demon Acafla, who was turned to stone but if activated will suck the world into hell.
Kendra the vampire slayer also returns to Sunnydale as her watches senses a dark power on the rise. Angelus leads Buffy away from the group but it's a decoy as meanwhile Drusilla and a host of other vamps attachk the scoobies in the library. Drusilla bags herself a slayer, killing Kendra. There target was Giles who they believe will be able to tell them the ritual to awaken Acafla.
The episode ends with Buffy making her way back to the library to find Kendra dead and Xander and Willow knocked out. Just when it appears things can't get worse the cops show up thinking Buffy is to blame for all of this.
In reflection this is a great episode. We have the flashbacks of Angelus/Angel's histor. We have the death of a slayer and the episode leaves us desperate to find out what will happen next setting up a cliffhanger season finale.