One of my favorite scenes in all of Buffy is in S2E1 "When She Was Bad," when Buffy is dancing with Xander at the Bronze while Cibo Matto performs and she leans into him and says "Did I ever thank you for saving my life?" and then leans even closer and whispers "Don't you wish I would?" Hot like burning; I bought the Cibo Matto album on the basis of that scene alone.

As for episodes: The Body is a solid top choice, though I have trouble rewatching it - toooo many feels. I like Bewitched, Bothered and Bewildered quite a lot. I was a big S2 fan, I guess.