Spoiler Level: High
I was wondering why Clark was being "Dick Clark" again at the beginning of this episode. I mean sure, it's been a given that the Luthors were evil, but it felt like he was being overly harsh to Tess just to drive home the point that she couldn't share her new-found secret that she's really Lena Luthor with him. But once Clark got zapped to Earth-2 I realized it was all set up so Clark could learn that just because Tess was born a Luthor doesn't mean she's got evil in her DNA.
In this take on the Superman doppelganger Ultraman, the entire universe isn't necessarily an evil opposite, and there's no good Alexander Luthor. Its main diverging point is that Lionel Luthor found baby Kal-El instead of John & Martha Kent, and raised him as Clark Luthor. There's no Crime Syndicate versions of the other heroes; Ollie is still something of a hero, although a questionable one, as he's been buying up land in Smallville and kicking out the owners so he can harvest as much Kryptonite as possible to fight Ultraman. (And really, if ever there was a time to show Ollie with his goatee, this was it. Talk about a missed opportunity.)
The universe Ultraman comes from in the comics has at various times been the Antimatter Universe, Earth-2, Earth-3, and probably a bunch of other ones I don't remember, so I'm quite happy with Lois referring to the Smallville version as Earth-2. I'm generally a fan of stories of alternate timelines and parallel universes in general, and while the Smallville Earth-2 may not be a complete "evil opposite" universe, it is definitely a darker, dirtier place, so it works great for me.
One thing, though...
Based on the ending, Earth-2 Lionel must have gotten the Mirror Box off of Ultraman once he returned to his own universe and Earth-2 Ollie zapped him with the Kryptonite window again. But we've seen that the Mirror Box always switches you with the location of your doppelganger. Which means that a three-year-old corpse showed up in the Earth-2 Watchtower... and Earth-2 Lionel arrived buried in Earth-1 Lionel's coffin, and would have had to dig his way out. Icchhhkk.
As of this writing, this episode is available to watch for free (with commercials) at http://www.cwtv.com/cw-video/smallville/. I'd also like to give a long-overdue thanks to homeofthenutty.com, which is an excellent screencaps site and where I've been getting all of my Smallville screencaps for my reviews. These guys capture every single facial expression of every single scene, and I've never ever had a problem finding the image I wanted!