This episode is just filler.
All they do is hang out at the school and try to build a giant pizza. Well, a pizza will bring out C.C., so she shows up and comedy ensues. Nothing in the story is advanced or explained. One could probably watch the next episode and not be terribly confused. The closest they get to adding to the story is just some explanations and two more knights show up with Suzaku. It is nice to know there is nothing pressing in Area 11 that anyone needs to handle.
Not only is it filler but it is filler with a ton of fan service. Basically any of the young women who one may like end up in fan service positions. Kallen is almost naked in a costume. Shirley and Villeta are both in bathing suits. Even C.C. has some fan service moments.
The ending has a bombshell but it would be rude to tell you what it is.