After the thought-provoking events of the previous episode, it makes sense for the writers to step back a bit and prepare for the finale. This actually feels more like the first hour of the finale than an episode in and of itself, but that's largely the effect of the serialized nature of the series.
The entire season has been split between the events in the past and the events in 2007. The vast majority of the story has been set in the time of the Dharma Initiative, however, which suggests that the events in 2007 are mostly setting up the situation for the sixth and final season. With all the foreshadowing of a final conflict over custody of the island coming in the final season, it seems reasonable to assume that Daniel's recent theory was wrong and Jack's plan will fail.
Jack is currently on an interesting journey, one that roughly parallels Locke's journey towards the end of the second season. Jack is trying to find meaning in everything that has happened, because it has defied his season of rational order. Because it appears that Locke was right about his own destiny, Jack has come to the conclusion that they all have a destiny to fulfill, and he's trying to find one that can restore his former certainty.
The irony is that Jack, like Locke before him, is not truly changing. Just as Locke was still hung up on his own expectations of destiny and self-importance, haunted by the past, when he tried to take control of event in the Swan Station at the end of the second season, Jack is only changing the manner in which he tries to take control over a situation. He talks about destiny, but he's more interested in denying the last three years of his life than learning from them. In terms of the redemptive theme of the series, Jack still hasn't made the turn.
With regards to the rest of the Oceanic Tribe, the situation at the Dharma Initiative is rapidly spiraling out of control. It's a bit surprising that it took so long for someone to use Juliet against Sawyer, once it was clear he wouldn't talk. It's one of those standard interrogation techniques (hurt a loved one to convince someone with a stiff upper lip to talk), and Horace wasn't above questionable methods with Sayid. It's also surprising that they agreed to let Sawyer and Juliet leave on the sub, and didn't bring up the fact that Sawyer, Juliet, and the rest of their friends just showed up one day, three years earlier!
Similarly, Pierre Chang's decision to believe Daniel's story was a little convenient, since there was nothing concrete to base that decision on. Questioning Hurley was a smart move, and one of the more amusing moments of the episode, but it still seemed a bit too smooth a process. That said, it does close the loop on the question of when Miles and Charlotte left the island. It's not entirely clear how Kate convinced Radzinsky or Horace to put her on the sub as well, or why Miles, Jin, and Hurley didn't attempt the same, but there wasn't necessarily time to cover those details.
It's good to see more of the tunnels under the island, dating back to ancient times. One might assume that this is how Cerberus gets around, since it's source is also underground. Richard specifically mentions that there is a way to get Jughead out of the tunnels, but it's not the way they came. It could be that they don't get the bomb anywhere near the site of the Swan Station, and instead, at the time of "the incident", it is closer to a portion of the tunnels close to where the statue once stood. That could, in turn, link to Ilana and Bram's gambit in 2007. (Radzinsky's decision not to take the warnings seriously could, in turn, explain why he chose to man the Swan Station for so long, and what ultimately drove him to suicide.)