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At the end of the first part, Teal'c and Bra'tac had left Earth to try to find Jaffa support for Earth against Anubis's impending attack. On Earth, it wasn't clear that Dr. Weir even believed in the threat. O'Neill continued to change from the effects of the Ancient knowledge repository.
At the beginning of this episode, O'Neill continues his fixation with crossword puzzles. However, it seems that this may be some kind of behavioral side-effect from the effects of the Ancient repository, because he's answering some of the puzzle in Ancient. Daniel and Carter figure out that his answers are actually signs to tell them where the Lost City is. They come up with a stargate address, but it's to a planet they tried to dial unsuccessfully before, so they surmise its stargate has been buried. Fortunately, Teal'c and Bra'tac have found a ship through a young rebel Jaffa.
In the first part, we were unclear about whether Dr. Weir would permit SG-1 to try to find the Lost City if they got a lead from O'Neill. Now, as O'Neill's transformation continues and he begins gathering equipment to take with them (although he doesn't know what it's for), she seems rather swept away by the urgency of SG-1. She approves their mission.
SG-1 (along with Brata'c and the young Jaffa) use the Jaffa ship to head to the planet. In a painful scene, Carter tells O'Neill that General Hammond gave her orders to take command when O'Neill seemed to no longer be in control (Give credit to Hammond for thinking ahead!). She is hesitant to do so now, but O'Neill says she should take over, and that he resigns. It's not clear how seriously either of them take this resignation, since Carter continues to treat him like a soldier.
They arrive at the planet and find that it is covered with lava because the planet's sun has begun dying and is in a red giant stage. (This is reasonably accurate!) However, they find a small protected area on the planet's surface. SG-1 rings down to the surface. O'Neill finds some kind of "command chair" among the ruins. He uses it without hesitation to find what is presumably the Lost City - and it's on Earth. However, the trip was not a waste, because he also removes an Ancient power source to take with them. This experience seems to drain the last of O'Neill's English-speaking ability.
When they get back to the ship, they find Bra'tac near death from a knife wound from the young Jaffa, who was working for Anubis. (Bra'tac still kicked his ass, though.) O'Neill heals Bra'tac, like we saw the Ancient Ayiana do in season 6's "Frozen". (This is somewhat ironic considering that O'Neill was the only one in that episode that Ayiana didn't heal before she died.)
They head back to Earth. O'Neill modifies the ship (to go faster) and the ring transporter (for unknown reasons). Although he can no longer speak English, and we're not sure he understands it, he and Teal'c have a good moment together.
Meanwhile, on Earth, Anubis has arrived. First he sends a small force to feel out Earth's defenses, looking for Ancient weaponry. The president decides not to reveal any advanced technology, not even the Prometheus and its fighters, at this point. They apparently send a carrier battle group. I'm not really sure what this would do - I didn't think carriers (or associated ships and fighters) had anything that could attack something in orbit. At any rate, the battle group is promptly wiped out. Anubis sends a holographic transmission to demand the president's surrender. The president must have taken diplomatic lessons from O'Neill, because he refuses and gets in a few wise-cracks.
Anubis sends in his entire fleet. Vice President Kinsey panics and tries to get the president to evacuate to the alpha site; the president tells Kinsey to go. By the time Kinsey gets to the SGC, Anubis is disrupting communications and power systems all over Earth, and the SGC loses power. Dr. Weir has been doing her homework, because she orders the stargate's iris closed manually, just in time to keep Anubis from sending a nuclear bomb through. Kinsey panics again because he can't get off Earth. When Weir recommends to the president that they do their best to hold back Anubis until SG-1 returns, he loses it. The president fires Kinsey - yea! Then he agrees with Dr. Weir.
The president assigns General Hammond to command the Prometheus and its fighters to fight a holding action against Anubis's fleet. Just as they take flight, SG-1 returns, heading for Antarctica. Apparently the Lost City is located in the Ancient facility where the Antarctica stargate was found (in season 1's "Solitudes"). Hammond orders Prometheus and its fighters to protect SG-1's ship at all costs. And the cost is high: all of the fighters quickly are either shot down or run out of ammunition. Prometheus itself takes a severe beating.
The modifications O'Neill did to the Jaffa ship let the rings burn down through all the ice to the Ancient base. SG-1 transports down. Bra'tac moves the ship off, which signals Hammond that the Prometheus can leave. Since the Prometheus is out of ammunition and its shields are failing, Hammond orders a ramming course for Anubis's ship.
Under the ice, O'Neill quickly locates another command chair, which they use the Ancient power source to power up. Anubis transports Kull soldiers into the base. Despite the anti-Kull weapon, SG-1 will clearly be overwhelmed in short order. However, Anubis is too late: O'Neill activates the defense systems of the base. Thousands of glowing, gold drones (apparently made of energy) shoot out of the base. They apparently vaporize the Kull soldiers, and they destroy Anubis's death gliders and smaller ships, then begin severely damaging his mother ship. (Prometheus disengages, although the drones are somehow smart enough not to attack friendly forces.)
The golden drones quickly destroy Anubis's mothership, apparently killing Anubis himself. The drones disappear. O'Neill is left unconscious. The rest of SG-1 place him in a stasis chamber that he had pointed out upon his arrival; clearly he had thought it was his only chance to survive. In the end, Earth is saved (again!) but O'Neill may be lost.
This episode is all about the action involved in saving the Earth, and there is hardly a chance to take a breath. Even so, there is more happening than just lots of cool special effects.
SG-1 and the rest of us weren't sure what Dr. Weir and the president would do when the threat actually came - fortunately they were smart enough to let SG-1 do their jobs. It was satisfying to see Kinsey fall apart when he couldn't leave the planet and save his own skin.
The plotting was very clever, but still believable, concerning Anubis's attack. His initial attack on the carrier was a test - a costly one for Earth's military forces, but not too costly in lives (compared to wiping out a city). By the time Anubis was ready for a full-scale attack, he was diverted to Antarctica to try to head of SG-1. The clever part of this plot is that the writers managed to keep from revealing the existence of aliens to the general public on Earth. However, more and more military personnel are being exposed to that knowledge - it seems that something has to leak out eventually.
O'Neill seems to gradually drift away in this episode as he is transformed. Even as he becomes less and less vocal, what he does say becomes quieter - during his conversation with Carter where he resigns, he nearly seems gone already. Once he can no longer speak, he hardly seems connected with reality. But when he does make a connection, his expressions convey so much. At the end of the episode, he is put into stasis, but who is going to be able to "fix" him? It seems that SG-1 needs to track down the Asgard again. But is O'Neill too far gone this time to save?
Carter in particular seems shaken by O'Neill being placed in stasis. She had been trying to tell O'Neill something all last episode and this episode, but never got it out. What is eating her? Her reaction seems a bit too much for just potentially losing a good friend. Has she realized that she does have romantic feelings for O'Neill now that he's gone? Is this another manifestation of her going for a "safe bet" like she self-analyzed earlier in the season in "Grace"? At least she should be well-motivated to find any way to cure him.
We also get the revelation at the end of the episode that the Antarctica base in an Ancient base, it's not the Lost City. SG-1 seems to think that the Lost City is the lost city of Atlantis. This, of course, leads into the spin-off series Stargate: Atlantis.
This episode does a great job of wrapping up the Anubis plot line, in a very satisfying way. Those Ancient weapons are pretty cool. The last question for this episode would be: is Anubis really dead? Could he have slipped away somehow (a la Darth Vader in Star Wars: A New Hope) or could he have ascended again?