Gingerbread - S3-E11
Factual error: There is a short picture of a 17th century German newspaper. The actual text however not only is written in modern High German as opposed to Mid-High German, but also is full of errors (mixing female articles with male nouns is only one example). Funnily enough, Giles' incantation at the end of the episode is in correct German. (00:30:45)
Gingerbread - S3-E11
Factual error: When Giles and Cordelia are driving to save the girls from getting burned at the stake and are making the potion to make the demon show his true face Giles tells Cordelia to shred the Wolfsbane. This is a huge mistake as any Witch will know (my sister pointed this out to me) that Wolfsbane is highly poisonous and should never be touched with bare hands and Cordelia didn't have gloves or anything.
Chosen answer: Angel is saying that he is still jealous and Buffy recognizes that this is his way of saying he wishes that they could be together. That is why they both smile.