Continuity mistake: When Veruca comes to Oz's cage to spend the night there, she tosses her jacket onto the round stone thingie (knob?) at the end of the stairs, and it covers the whole thing. However, when Willow discovers them in the morning and Veruca goes to pick up her jacket, you can see that it has moved. Willow didn't touch it when she entered, and both Oz and Veruca were locked up so they couldn't get anywhere near it. (00:26:35 - 00:29:20)
Visible crew/equipment: At the very end of the scene where Buffy and Giles discuss what happened (including The Initiative), you can see the microphone at the top of the screen. (00:39:45)
Continuity mistake: When Oz leaves and holds Willow close to him, the position of their noses changes depending on the camera angle. In the shots of OZ they're pressed together and in the shots of Willow they're not.
Continuity mistake: When we see Veruca eating at the table, she reaches for a cup as we see Oz coming up behind her. The shot changes and we see her turning around and reaching for the same cup again, though she never had time to put it down.
Visible crew/equipment: In the scene where Willow visits Xander to discuss what may be going on with Oz; towards the end of the scene, when the camera is on Willow, you can see the sound mike at the top left of the screen next to the green crate in two different shots.
Revealing mistake: Towards the end when Oz says to Veruca, "You don't wanna find out what I am", and partially turns into a Werewolf. You can tell that both of the actors were filmed separately for the CGI's sake as Oz stands out from the picture more than Veruca does. The same effect is obvious during "Doppelgangland" in season 3 where there are 2 Willows onscreen at once.
Revealing mistake: In the scene when Oz stops the female wolf from attacking Willow, and they both change and Oz tears her neck out, if you look closely, you can see the actor's real skin at the neck.
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.