Plot hole: Some part of the dialogue between Jean-Luc Picard and Admiral Kirsten Clancy must have been left on the editing room floor, because when Commodore Oh refers to the conversation the two had, says that "He referred to Zhat Vash by name." He did not. (00:21:30 - 00:37:30)
Plot hole: Mr. Vup is a Beta Annari, and they can, as it is stated (and for comedy purpose stated again) literally "smell" lies. However, Raffi gives Rios a unique concoction that camouflages lies, and it is made of drugs (beta blockers, anxiolytics, benzos). At least two things don't make sense here. First, Picard gets no shot and his whole flamboyant performance is one big lie from beginning to end, but he is not sniffed out - you'd also assume they could easily tell he has both eyes, since they have various detectors. Second, when the substances kick in as Rios is forced to lie openly, even us the audience, as olfactory-impaired as we are, can see he is getting high as a kite from him making a funny face; a species that can detect subtle changes in a metabolism over a simple lie, surely would detect when someone has such a dramatic alteration in front of their eyes - and see that as a telltale sign of something fishy going on.