Plot hole: When Jo is getting to walk down the aisle with Queen Clarisse, he hands Shades his top hat and then pops his ear piece right off, in a split second, and puts it in the top hat. In the previous scenes, Princess Mia has Lionel's ear piece stretched from the back of his neck, across his jaw and around his chin and then stretched to her ear but it hasn't popped out, while Queen Clarisse jerks Charlotte with her when she goes to listen to Princess Mia.
The Princess Diaries 2: Royal Engagement (2004)
1 plot hole - chronological order
Directed by: Garry Marshall
Starring: Anne Hathaway, Julie Andrews, John Rhys-Davies, Hector Elizondo, Callum Blue
Continuity mistake: When they are looking at prospective husbands, Princess Mia and Lilly are eating popcorn and Lilly asks if it tastes like pears. Princess Mia answers its a "Genovian specialty," and the popcorn disappears immediately afterwards. (00:25:45)
Queen Clarisse Renaldi: A princess never chases a chicken.
Trivia: In the scene where Mia sees all of the past royals in her family the paintings on the walls, they are of writers and producers.
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Answer: My guess is because Mia and Michael didn't actually start dating until the third Princess Diaries book. The second and third books were all about Mia trying to get Michael to go out with her, and since they went out at the end of the first movie, they couldn't base the second movie on the second book.