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The "full circle" part of the episode is apparent immediately, when the episode starts on Abydos and Daniel shows up, since Abydos is where the Stargate SG-1 series began. Apparently Anubis has found all but one of the jewels called "eyes" (such as the Eye of Tiamat which figured in Season 5's "The Tomb". When we left the Eye of Tiamat in that episode, it was buried under a collapsed ziggurat. Apparently Anubis has quite the resources to have been able to dig it out.). The Eye of Ra is hidden on Abydos; once Anubis has it, the combined power of the eyes will give him a huge advantage over all over Goa'uld and obviously make him harder for Earth and its allies to defeat. Anubis is on his way, but Daniel promises Skaara and the others that help will be forthcoming.
When Daniel appears to O'Neill to convince the SGC to help Abydos, we discover why O'Neill never mentioned Daniel's visits earlier in the season in "Abyss": he wasn't sure the visions of Daniel were real. O'Neill then conveys Daniel's information to General Hammond and the rest of SG-1. Once O'Neill reveals that the information is from Daniel, Hammond and the other members of SG-1 don't even question it. This is a wonderful demonstration of the trust between them and even of the ascended Daniel. Hammond gives SG-1 a "go" to assist Abydos.
SG-1's return to Abydos and their reunion with the people and, in particular, Skaara, is poignant. As far as we know, this is the first time O'Neill and Skaara have seen each other since Skaara was freed from his Goa'uld in season 3's "Pretense". At first, I thought that this was uncharacteristic and unlikely, but then I thought about how often I contact friends in other states (let alone other planets) and realized it's probably pretty realistic. We find out that Skaara is getting married.
Jonas and Carter start looking for the Eye of Ra, but there are so many places to look in the chambers under Ra's pyramid, they are at a loss. Anubis is expected to arrive at any moment; O'Neill knows that Daniel is observing them, and he eventually loses his patience and demands that Daniel show himself and help them. The difficulty is that according to the "rules" of the ascended beings, Daniel is not allowed to do anything to help or hinder corporeal beings. (We first learned about these rules in season 5's Ascension, with the ascended being, Orlin.) However, with the situation as desperate as it is, O'Neill cannot consider long-term effects and insists that Daniel cross the line and help them.
Daniel, Carter, and Jonas together quickly find the hidden chamber of Ra. It's a nice touch to see Jonas pull out equipment of Daniel's that he took and to see Daniel realize it; how often could that kind of situation come up? When they search the hidden chamber for the eye, Daniel spies a complex message on a stone tablet. Upon reading it, he comes to a major revelation for the entire series: the beings that ascended before him (such as Oma Desala) are the Ancients, who originally built the stargate system. Thousands of years ago (around the time of the freezing of Ayiana in "Frozen" earlier this season), the Ancients were suffering from an epidemic (presumably the same disease that ultimately killed Ayiana). Some of the Ancients figured out how to ascend, and the rest died.
However, there must be more to this story than is revealed here. First, it's hard for me to believe that the Ancients could not find a medical solution to the disease; besides the fact that their technology was very advanced, apparently at least some of them had healing power like Ayiana did. In addition, wouldn't the Asgard, the Nox, or the Furlings, allies of the Ancients, have been able to come up with a cure? Instead, the Asgard simply said that the Ancients had gone away, which is curious.
Another question is whether or not the Ancients were the first ascended beings. Did anyone help any of the Ancients ascend, or did they figure it out for themselves? As I write this, the series is in season 10 and Earth has encountered the Ori, which provides more of the history of ascended beings.
After Daniel's revelation, he goes to confront Anubis and vows to stop Anubis from destroying Abydos. Anubis reveals that he is also an ascended being, at least partly. Daniel isn't really sure how this is possible, but he deduces that Anubis (as a Goa'uld) figured out how to ascend, but when he got to the "higher plane of existence", the other ascended beings tried to send him back. They were not completely successful, so Anubis still has some of the powers of an ascended being. Anubis's dual nature explains how he has uncovered so much advanced and unknown technology and has so much knowledge of the Ancients.
Daniel makes a deal with Anubis: Anubis will get the Eye of Ra, and in exchange he will allow SG-1 to leave safely and he will not harm Abydos.
Meanwhile, Carter and Jonas have found the Eye of Ra. (I loved Carter shooting out the wall - a sign of the desperation of events.) Anubis's forces have attacked and overwhelmed SG-1 and the people of Abydos so that they have all fallen back to a single chamber within the pyramid. They are in a stand-off: they have threatened to destroy the Eye, while Anubis's First Prime, Herak, has them surrounded. O'Neill derives some black humor from needling Herak, whom he met earlier in the season in "The Other Guys". However, Skaara has been fatally wounded during the attack; he dies and visibly ascends.
Daniel returns and informs O'Neill of the deal, and also reveals that it was Oma Desala who helped Skaara ascend, not him. After Daniel's assurances that he will disobey the rules of the ascended and enforce Anubis's end of the deal, O'Neill reluctantly gives the Eye of Ra to Herak. Anubis's forces leave the planet.
When Anubis receives the Eye of Ra, he cackles that his ship is now fully "armed and operational", er, that is, fully powered. He decides to destroy Abydos anyway. Daniel returns to counter him, but then about a dozen ships arrive from the System Lords, led by Lord Yu. The System Lords don't want Anubis to have the Eye of Ra, either, and they surround Anubis and demand that he surrender the Eye of Ra. However, apparently the System Lords don't realize that space is three-dimensional, and they surround Anubis's ship in a two-dimensional plane. Conveniently, Anubis's ship fires in a two-dimensional star shape, so he easily defeats the System Lords. Just think - if the System Lords had put some ships "above" and "below" Anubis's ship, the battle might have turned out completely differently.
Anubis then proceeds with his plan to destroy Abydos. Daniel begins to "power up" to stop him, but before he can attack, he is whisked away by another ascended being, presumably Oma Desala. Anubis is free to attack with impunity, and destroys the pyramid and its surroundings in Abydos in a spectacular effects sequence. Fortunately for SG-1, they have just returned to Earth, although they realize an attack has occurred.
After some time, the SGC is able to re-dial Abydos with the stargate, and SG-1 returns. They find everything eerily perfect and unharmed, including all of the people, even Skaara. Skaara reveals that Oma Desala enabled all of the villagers to ascend when Anubis's attack killed them. They have re-created the surroundings and the stargate so that SG-1 could return and see that the people are safe; however, once SG-1 leaves, they will never see the Abydos people again.
This episode does not end on a cliffhanger, but many issues are unresolved. Anubis is still at large with his special powers and now his supercharged ship (because he has all of the Eyes). Daniel's status is unknown because he violated the rules of the ascended beings. But there is some hope - Daniel told Jonas and Carter to save the stone tablet because it also told about a "lost city" of the ancients that would provide them with some huge advantage over Anubis. However, the tablet must still be translated, the city's location is unknown, and it's not clear any more than Daniel will be able to help them.
The dual revelations of the Ancients being the ascended entities and Anubis being part-ascended really take the situation in this episode to a much more important level. These two issues are really interwoven. Previously, we had seen the ascended beings as wiser entities, and we pretty much understood and accepted their "prime directive" of not interfering with what corporeal humans do. However, now we know that humans (in the form of the Ancients) were actually able to get themselves to ascend, showing that ascended beings are not necessarily superior to present day humans. In addition, it's clear that the ascended beings have really dropped the ball when it comes to Anubis.
If the ascended beings wanted to kick Anubis out of their ranks, they needed to do so completely - after all, we have seen an ascended being become completely human in the form of Orlin in season 5's Ascension. Was the failure with Anubis because he didn't want to go back? Now the fact that he is so powerful as a part-corporeal being is their responsibility. Morally, they should no longer adhere to their non-interference policy, since they are directly responsible for turning Anubis loose. However, how could any corporeal human actually communicate with one of the ascended beings and actually convince them of this? This seems like a major issue for the next season.
Some other issues, in no particular order. The parallels with Star Wars: Return of the Jedi when Daniel and Anubis confront each other are amusing. Since both of them have gotten to their positions (plot-wise) fairly naturally, I think the parallels are OK. However, the continuing parallels in season 7 start to feel like a rip-off.
It's nice to see the interaction between Daniel and his former teammates. The conversations between Daniel and O'Neill nearly crackle. When Daniel first shows up in the elevator, he is almost bursting with his urgent message, but then you can see him calm himself down and play out the scene O'Neill wants, because he knows O'Neill's character so well. Later on, when Daniel is working with Carter and Jonas, the three fit together well as a team.
Another amusing scene is when O'Neill reveals that he has seen Daniel before, and then Teal'c admits that he had, too. Their "why didn't you tell me" attitudes are very appropriate to them. They don't really realize that Daniel had purposely only visited them during times when they would dismiss the meetings as imaginary.
The assault by Anubis's forces on the pyramid on Abydos was impressive. Clearly Anubis wasn't pulling any punches and quickly overwhelmed the defenders. I thought it was clever for him to attack the gateroom in the pyramid with Jaffa on foot, Jaffa sent in via the rings, and to also activate the stargate. Talk about an assault on multiple fronts! When Skaara is injured in the assault, you can see O'Neill kick into a higher gear to get to his side, unfortunately to no good effect.
Daniel showed dubious judgment in striking a deal with Anubis. However, I realized that he was trying to avoid breaking the rules of the ascended. If Anubis went through with the deal, then Daniel hadn't seriously broken any rules, which is what he was hoping for; but if Anubis betrayed him, then Daniel would have to make a major "infraction" by stopping him. Daniel was gambling, and he lost. However, he did at least ensure that SG-1 would escape with the table about the lost city.