Viserys as king has mostly just maintained peace in the kingdoms since his predecessor, which I suppose is a good thing. I believe the previous kings brought war and destruction to the people of Westeros so he's not considered a bad king by any means. Maintaining peace isn't easy and it was basically a legacy given to him by Jaehaerys so he's done his best, even though he never wanted to be king. In that context of him inheriting an era of peace, he hasn't wanted to disrupt it by going to war, and I can understand that perspective but I don't always agree with his actions lol
As for his illness, it was confirmed by the actor to be a form of leprosy, basically a chronic bacterial disease that causes the infections you see on his body.
In this episode, Rhaenyra is about 18-19. They mention Aegon is now 3 and Alicent's second baby has already been born so there was another small timeskip. This episode certainly made me remember "ah...Targaryens will be Targaryens ๐ " You're correct that they didn't finish having sex. Daemon realized what he was doing and stopped himself and basically left Rhaenyra horny af so she went to Criston after while he went drinking and crashed out ๐