In this episode we discover that Rose has some kind of disease, while looking back at one of her flashbacks. We also discover that Rose and Bernard end up in Australia because Bernard takes Rose to Australia for a honeymoon in faith that she might be cured by some Guru.
In fact she isn't cured, but in some sort of mysterious way she is cured by the Island. Not only is she the only person cured, but John Locke is also cured from being paralyzed.
Maybe this Island isn't bad after all, and was all part of faith. We'll have to see in the next episode or in the next season. Meanwhile, Jack and Kate set out to go look for the "Others" to try and see if they can trade Michael and Walt for the prisoner they have in their hatch, at the end of the episode they both find Michael running and passing out.