I liked the episode, but I'm a sucker for "secret origin" stories like this. Owen's assholiness in the first season -- not to mention how deeply Diane affected him in "Out of Time" -- is brought into sharp relief here, and we now have a very interesting arc for him. Losing the love of his life caused him to snap and turn into a jackass. Losing another love of his life caused him to snap back, in essence, as the Owen we've seen in season 2 looks a lot like the Owen in the flashback.
Jack's flashback was also entertaining. The glimpses we've gotten of the Torchwood of old have all been great fun, and something I hope we see more of (though I liked the pair in "To the Last Man" much more than the Wonder Twins here), and it was a relief to finally see them actually use the phrase "the Doctor" on Torchwood. The caginess about actually saying his name has gotten tiresome, particularly in the three episodes that guest-starred his ex-companion. And it was nice to get insight into how Jack remade Torchwood, particularly the tragic component of it (that he took over by virtue of being the only one to survive the previous head of TW3 going binky bonkers).
Tosh's own skittishness also makes a lot more sense now. One wonders if what Adam did was make her completely forget her imprisonment at UNIT's hands. (And I wanted to hate what they turned UNIT into, but given some of the more bloodthirsty actions the Brigadier took during the Pertwee years, I can't bring myself to doubt that UNIT would behave that way in a post-9.11 world -- remember, Tosh's flashback was only a couple of years after 2001.)
Finally, Ianto's eager-puppy-dog attempts to get a job sticks in the throat, because for all the charm and flirtiness of him and Jack, we know from "Cyberwoman" that it was all an act so he could get a facility in which to hide Lisa....