I like this show more each week. It's often completely ridiculous, but it's also a lot of fun and I'm loving all of the character development we get in each episode.
I agree that Walter's whole "I don't like physical contact" thing is obviously not completely true. He has been affectionate with both Ralph and his sister and I remember an episode where Sylvester hugged him and he didn't seem to be bothered by it. I suspect it mainly applies to Paige because he obviously has feelings for her and it would threaten his conviction that romantic love is imaginary.
I loved that Paige went to talk to Toby. I like that they are continuing to develop that friendship. I have a feeling that Toby will be influential in Paige and Walter eventually starting a relationship. Maybe subtly helping Walter with his issues.
Loved seeing Happy showing a little jealousy when Toby was flirting with the CIA tech girl and I'm pretty sure he was doing it mainly to get under her skin.
My other favorite moment with Happy was at the end, when they were all staring at the plane and Toby and Walter were discussing love, you could see Sylvester off to the side looking like he was close to a panic attack. Happy was next to him, looking concerned, and she reached over and touched his arm. Love these sweet little character moments.