There were some odd things about this ep, starting with the fact that there was really no setup for it at all. It started, and Rin, Izumo and Shima (Kuro, too) were at the beach for reasons that weren't really clear. They were selling squid, there was a teacher there I didn't recognize (is my memory shot?) and some mention of it being a job.
Really, all of this was a setup for the introduction of a young boy named Youhei (Yumiko Kobayashi) who saves a cramping Izumo from drowning. He butts heads with her (literally) and generally acts like a shounen hero, taking a moment to call her cute. Turns out his father was lost at sea six months earlier trying to kill a demonic giant squid that turns the ocean black, ~degeso. Youhei has decided to avenge his father by destroying the beast, and our trio plus cat sidhe decide to keep an eye on him at their teacher's urging. The squid eventually does show up - surprisingly, along with Youhei's father just at the moment Rin is about to make lacrimal out of it. Turns out the squid had a change of heart and proved itself a softie, helping Youhei's Dad find his way home. The teacher says the moral of the story is that demons can have a change of heart, too.
That was certainly odd. There were some pretty humorous moments, especially the bit at the end where Izumo finds out just why Youhei thinks she's cute (and I wonder if there's any significance to the dog being named Shiro). But even by stand-alone episode standards, this was really stands alone. It was odd enough to feel quite discordant with the series as a whole. We'll see if things normalize at all next week, which looks like an amusement park episode ("Go to Hell"?) featuring a lot of Shiemi.