So Walter talks her through the process again, saying he's going to try to guide her back to the place where John Scott met Daniel Hicks. He uses the "flight of stairs" imagery to send her back into memory world. After he counts back from five to one, Olivia sits straight up, waking up in a bedroom bathed in red light from outside. Walter asks where she is. Olivia says it's a bedroom at first, before realizing it's the motel where she and John used to meet. Just after she remembers, John and Olivia herself come crashing through the motel door, kissing and collapsing on the bed, removing their guns, as you do when you'd rather not shoot yourself in the balls. Memory Olivia says, "This is crazy," and John says, "Absolutely. This will never happen again." Olivia watches the whole scene. Walter asks what she sees. "Me and John," is all Olivia says. Walter tells her not to worry, that John can't see her: "Remember, you're observing a memory," he says, even though last time John WAS able to see her.
Anyway, Memory Olivia says, "I'll be right back," and heads into the bathroom, while John takes off his tie. He gets up to adjust his hair ... and then looks at Olivia in the reflection in the motel mirror. "Hi, Liv," he says. In the tank, Olivia gasps. "John's talking to me," she says. "That's not possible, Olivia," says Walter, insisting that John can't see her. Someone should tell John that, as he continues to stare at her in the mirror. Walter says they'll try to take her somewhere else, back to where John and his accomplices met.
But before they can do that, Memory John turns around and looks at Olivia, who, freaked out, draws her gun on him. "Liv, what's wrong?" he asks. Olivia tells him not to move, which the Fringe team can hear, and Walter urges her to focus on the sound of his voice.
Olivia is instead focusing on keeping Memory John from coming any closer. "I miss you," says John. Doing her best to keep from completely losing her shit, Olivia asks John about working with Conrad, who developed a biological weapon: "I want to know who he is, and who he's planning on selling it to."
John wants her to put the gun down, but Olivia won't. "I know that you're part of a terrorist cell, and tells him about Bowman being dead and Hicks dying of a virus. John looks like he's mulling this all over, and comes a little closer, which earns him a shot through the heart, and Liv's to blame.
The little scan things on the instruments the Bishops are watching go all cuckoo, and Peter wants to get her out, but Walter says it's too dangerous, and they need to "reconnect" with her before they pull her out. He starts calling her name, but she doesn't respond.