When Seven wants to hear a bed-time story, Peg makes one up on on the spot. She was a princess named Scarlet, who was kidnapped by Captain Courage (Al). She befriended the Crew, including Julio, the virgin Hunchback (Bud), the Ship's Navigator/Whore (Kelly), and the Cabin Boy-Girl (Marcy). Her Prince Paco (Jefferson) arrived to save her and captured Captain Courage, but Scarlet had fallen in love with Captain Courage. Rubio the Cruel (not based on anyone, perhaps, but played by David Garrison) arrived and Prince Paco fled with his true love, the Cabin Boy-Girl, while Captain Courage fought a sword duel with Rubio the Cruel and won, after kneeing him in the groin.
- This was Seven's last appearance as a character.
- The episode was also designed to offer David Garrison every opportunity to show off his musical theater roots.