I like the flash-backs in that episode, because it kind of foreshadows the darker side of Finch, but also because it migth partially explain Alicia Corwin's paranoïa and fall into madness in season 1.
Harold here not only threatened her life but also made her feel guilty for Nathan's death. It probably set in motion her leaving the government, isolating herself and slowly getting unstable.
In any case it was really nice seeing her character again for a final little tie-in.