The Seabee award he puts above the fire was won in the episode 'Someone To Watch Over Me' in season 2.
Right after the doorbell rings and before Frasier answers it, he is yelling about all the pain Diane caused him. Wouldn't she have heard him through the door?
Diane's facial tic was first seen in the first season of Cheers in the episode "Endless Slumper." They are often the result of extreme nervousness or stress. Having seen her beset before with uncontrollable facial tics, Frasier realizes that things are not quite as they seem with Diane.
When Mary Anne enters the set, all the characters call out "Mary", the same as the original Cheers cast did for Norm during the series Cheers. However, the character Ned, who is based on Norm, did not receive the same type of welcome.
The people in Diane's play are based on the Cheers crowd. For instance: Stan represents Sam, Clark/Cliff, Darla/Carla, Ned/Norm and Dr. Franklin Crean as you know who.
As referenced in "The Show Where Sam Shows Up," Frasier said that Martin was a research scientist who died before Frasier was 30. Diane must have heard the same story on Cheers, but does not mention the inconsistency any time in Frasier, especially in this episode, where they meet.
However, it is clear from the dialogue that Diane has met both Martin and Niles before, which Sam had not. So she would already know the truth about Martin.
When the waitress brings Frasier his coffee, she tilts the cup quite a lot and you can see that it's empty.
Frasier refers to the olive he offers Diane as "A Pyranean taste treat, hand-picked and bottled by Andalusian monks." The Pyranean Mountains are in the north-eastern corner of the country, along the French border, while Andalusia is a region on the south coast, several hundred miles away.
Diane : Niles, do you remember the last time I was in town and we dined together? You had just started dating this woman, she was the queerest little creature. (Fraiser hands her a glass of wine) Thank you. She ate everyone's sorbet, and then she had to lie down in the ladies' lounge while the coat-check girl messaged her abdomen. (She starts laughing until she sees no one else is) Oh, I hope I haven't put my foot in it. You and she didn't get married and lived happily ever after, did you?
Niles: No. can't say as we did.
Diane : Well, Martin, it's been too long. How have you been?
Martin : Well, my wife died, I got shot in the hip, and I had to move in with Frasier 'cause I kept falling down in the shower.
Diane: Well, you look wonderful . (Pats his leg) Yes you do.
Martin : That's the bad one.
Frasier : She's back. The scourge of my existence.
Niles: Strange, I usually get some sign when Lillith is in town. Dogs forming into packs, blood weeping down the wall.
(Frasier has just watched Diane's version of Cheers)
Franklin: (to Diane, the director) This whole getting-left-at-the-altar thing, I just don't know what I'm supposed to be feeling.
Frasier: (enraged) I may be able to illuminate that for you! (storms on stage) What you are feeling is that this woman (indicating "Mary-Anne") has reached into your chest, plucked out your heart, and thrown it to her hell hounds for a chew toy! And it's not the last time either! Because that's what this woman is! She is the Devil! There's no use running away from her, because no matter how far you go, no matter how many years you let pass, you will never be completely out of reach of those bony fingers! So drink hearty, Franklin, and laugh! Because you have made a pact with Beelzebub! (yelling) AND HER NAME IS MARY-ANNE!"
(The cast applauds Frasier's "performance")
Diane: So, there I was, on the balcony of my Malibu beachhouse, when a pod of whales passed by. I knew I had to commune with these gentle giants, so like a flash, I was on the beach, scrambling to my kayak. But cruel fortune interceded, when, not twenty yards offshore, I suddenly discovered myself entangled in an enormous bed of-of, um—
Niles: Seek help.
Diane: Exactly right, sea kelp!
Martin: (laughing) Oh, that's funny — I thought he said "seek help."
Daphne: I wish someone would just tell me who this woman is, and why we're trying to impress the pants off her.
Frasier: (increasingly manic) She's a one-time Boston barmaid who had a nervous breakdown and ended up in a sanitarium, where I met her, fell for her, and then was so mercilessly rejected by her that to this day there is a sucking chest wound where once there dwelled a heart!
Frasier: (referring to Diane) People can change, Dad.
Matin: I agree. Take me for instance. The old Martin would tell you you were are out of your mind. I'd rather see you go gay and shack up with the punk who shot me than go out with her.
This episode won the 1996 Emmy for Outstanding Editing in a Multi-Camera Series. Shelley Long also received a 1996 Emmy nomination as Outstanding Guest Actress in a Comedy Series for her performance in this episode.
This episode also allowed Kelsey Grammer and Shelley Long to lay some demons to rest. On Cheers, Shelley Long wanted to get rid of Frasier because she wanted Sam and Diane back together, while Kelsey and the producers wanted to keep him on. This episode, not only do Frasier and Diane finally make peace, but Kelsey and Shelley do as well.
Shelley Long reprises the role of Diane Chambers from Cheers.
(Frasier arrives at the Café Nervosa in great spirits)
Frasier: My God, Niles, it's such a glorious day I walked all the way here. Thirty-two blocks, Bruno Magli's be damned.
Bruno Magli is an Italian designer of very expensive dress shoes. Normally, you would never wear such shoes for long walks on cement sidewalks, it would ruin them.