With the Daedulus mushroom things running riot, there's only one option - To bomb Tokyo to the ground to destroy them and their threat. Actually, given the efficacy of Kuniko's boomerang on them I'd argue that there are two options to deal with their threat, but far be it from me to get in the way of blowing loads of stuff up.
It seems that Karin is of a similar disposition, for after initially telling Kuniko that there's nothing she can do to help, she soon changes her mind and offers her the chance to loan an army and the required bombers to take out Tokyo. She does this on two conditions - One, in return for knowledge of the date and time of the boming raid in advance (as a money-making scheme) and secondly, in exchange for Kuniko's knife, because she has some particularly delicious cake to slice. Or something to do with Atlas' AAA citzens, perhaps slightly more likely.
Anyhow, this all leads onto Momoko's earrings, which seem to suggest (in a slightly roundabout way) that Kuniko is Lady Mikuni's sister. Between that and the knives, I wouldn't be surprised to learn that Kusanagi is the brother of both of them. Darth Vader is the father of all three, of course. Beyond that, Momoko is also reunited with the new-look Miko, although she didn't seem too thrilled by it to be honest, giving us what was possibly the least emotional reunion ever seen in anime thanks to an apathetic transsexual and a screaming banshee.
This episode also sees the return of Nagiko, who ignores her previous banishment to wax lyrical about pickled vegetables again. Oh, and to save Kuniko's skin to some extent, doing her part to kick off a plan involving all of the residents of Duomo somehow sneaking into Atlas as illegal immigrants. They should just come to Britain, it would be easier, trust me.
Snark aside, this was (aside from the quality of the artwork and animation, which was atrocious) actually another "not bad" episode of Shangri-la - The whole Kuniko and Lady Mikuni as sisters concept felt rather forced, but that aside everything made a reasonable degree of sense, and I actually rather liked Kuniko's plan to force Ryoko's hand. Mind you, I suppose I like anything that involves a cartoonish villainess getting her comeuppance after an entire series of being fragrantly, annoyingly and bitchily evil. Perhaps the next episode can wipe the stupid "look at me, I'm so evil" grin off her face completely...