Okay, there's no infinite recursion, it stops at a million. Let me have my fun, geez.

Zero tells Suzaku that he and the Black Knights will be joining the Specially Administrated Zone of Nippon, so a reluctant Suzkau backs off. Back in the sub everyone is like, 'Wtf Zero?' Unfortunately we do not get to see Lelouch's (assumedly) convincing speech.
Throughout Area 11 there's an uproar over Zero's intentions.

Oh hai is that sum propogandas postur

Amidst carefree times at Ashford, Suzaku wonders if Lelouch's memories really haven't returned. He wants to ask Lelouch why he killed Euphemia, since it doesn't seem like something Lelouch would do. Suzaku is broken out of his reverie by an assassination attempt; a person wearing a Britannian soldier's uniform rushes him with a knife. Lelouch's order from last season kicks in, and Suzaku easily disarms the assailant. He realizes it was Lelouch who put on him the unbreakable order to live.

Diedthard has meanwhile sent back Sayoko to Area 11. Lelouch praises the man so hard he nearly creams his pants. Rolo wants nii-san Lulu to keep his promise (for like the third time this episode), which turns out be protecting Ashford Academy and their carefree way of life. Well, at least he's simple to please and protecting Ashford is part of Lelouch's interests as well. Viletta shows up, and Lelouch asks her if she'd like to see Ougi.

Elsewhere in DALLAS, TEXAS, we see what Table-chan's been up to this entire time. Turns out she's been working for Schneizel, doing… um… maybe another bomb? (As proposed by Shin…) Nina was taken in after she'd tried to AN HERO herself during the Black Rebellion. (Tried and failed, gb2 bomb-making class.) Another character is also introduced, a Pizza Hut delivery boy named Canon.*

Anya is assaulted molested disturbed by Arthur when Suzaku shows up. A Britannian staff shows up to have Suzaku sign for the execution of the man who attempted to assassinate him. When he hesitates, Anya signs it instead. She asks him if he's a masochist, volunteering for a country that hates him.

Suzaku, Anya, Gino, Lloyd, Cecile, and Nunnally's advisor gather to negotiate with Zero. Zero has a deal for them: he plans to bring in a million people to the Specially Administrated Zone of Japan, but wants Britannia to let him go free. They'll do so by exiling him. Nunnally's advisor, Ms. Rohmeier, seems to support this idea and they all eventually agree, since if Zero disappears the terrorists will be broken and scattered.
Afterwards Suzaku informs Nunnally of their decision, as she lets a candle with Euphy's name written on it into the pool. Suzaku notices that there's another candle there with Euphemia's name on it. Outside, Lelouch is shown leaving.

A picture says a million words… especially if the words are on the picture. lols

Next day at the Shizuoka Ghetto, over a million Japanese have gathered for the Specially Administrated Zone of Japan. The Britannian army is on standby to suppress any signs of revolt. Zero finally appears, with Ms. Rohmeier announcing that Zero will be sent into exile and those Japanese with not-so-serious crimes will be pardoned, etc. Suddenly confronting Suzaku, Zero asks him what it means to be Japanese. Suzaku responds that it is the heart, to which Zero agrees, cueing the Black Knight members in the audience to set off a smoke screen. The Britannian military panicks, and they are instructed to find Zero but when the smoke clears…

UR HART IS WAT MAEKS U JAPANSE LOL

In the duration of the smoke screen, all the million or so Japanese have donned Zero costumes. (Blah blah V for Vendetta and Spartacus cracks.) Rohmeier says that they couldn't possibly transport a million people, until the Chinese Federation's iceberg ship arrives. (I don't know about this. We all know what happened last time they tried to merge an iceberg with a ship…) That aside, it looks more like an iceberg with facilities attached to the side rather than a ship.

Where's Waldo?

Z-z-zzzzzzzero!

Viletta attempts to arrest some Elevens Zeroes. One of them tries to pull a pistol on her, but Ougi comes to her rescue.

awhhh…

Indignant at these turn of events, the Britannians prepare to fire on the Elevens Zeroes, Rohmeier included. Suzaku is suddenly reminded of what happened with Euphemia, and orders the Britannians to let the Zeroes go. Leaving the rest of the Japanese who remain in Area 11 to Suzaku, Zero takes his leave.

Turns out Zero was on the iceberg ship all along. Lelouch shows his face to Sayoko, who apparently doesn't mind. Ougi says his farewell to Viletta as he boards the ship. (b'awww)

Suzaku realizes that Zero knows him well, since the plan counted on Suzaku letting all the Zeroes go. On the boat, Lelouch thanks Suzaku for following his plan, or whatever.

Thoughts:
Throwing epic aside, I hit the logistics problem with the idea that Lulu pulled off. So (excluding Geass!), how did Lelouch manage to get a million people to cooperate with his plan without alerting any Britannian authorities at all? Is Britannia's underground network in Area 11 so bad that they can't even pull off some basic intelligence like that? Moving along, so a million people just up and boarded a boat without any belongings save a Zero costume. Code Geass R2 Stage 09 please explain these logistics to me plzkthx.
As for where they'll go with a million people on an iceberg… well, it was strongly hinted at the Chinese Federation, since we did get brief cameos of Xingke and an unnamed woman. Shin-nii thinks they'll be headed towards down under. lols.
*I didn't find the Pizza Hut advertisement in this episode so I made one myself. If you know when it is (or if there is one), let me know at what time in the episode. <3

Lay off the stim-packs, Xingke! :(