Alternative Joke Interpretation: Is Squidward's shocked reaction when Patrick reveals the truth because he realized he was attracted to a guy or is it actually because was hitting on Patrick specifically, a neighbor who has annoyed and harassed him for years? Given how Squidward has shown some attraction to men in the past, particularly Squilliam, the latter interpretation actually has some credence.
Values Dissonance: While this was considered one of the funniest episodes of season 4 for a long time, it has also aged the poorest, possibly the most out of the entire series, for a couple notable reasons.
Squidward and Mr. Krabs stalking and constantly asking “Patricia” on dates was shown to be overbearing and annoying Patrick to the point of no longer wanting to hide his identity at the time, but comes across nowadays as downright creepy as more awareness and knowledge of sexual harassment in the workplace became widespread. It also doesn’t help that Mr. Krabs hired Patricia just to flirt with her and try to start a relationship, nor the fact that literally every male in Bikini Bottom tried to hit on her one way or another. If this episode were to be released today, it would likely either have the harassment toned down significantly or openly call out the behavior of the male cast rather than using it for humor.
A lot of the humor in this episode resolves around the fact that Mr. Krabs and Squidward are hitting on Patricia and finding her to be the most beautiful sea creature in Bikini Bottom, when in reality the audience knows it’s just obviously Patrick in disguise. While one could interpret the jokes being that the characters are specifically flirting with Patrick rather than just a man in drag, especially for Squidward who hates the sea star, it still comes across as uncomfortable and brings in mind homophobic and transphobic tropes that were quite common on TV back then. The worst offender has to be the end, where Patrick strips naked after ripping off his disguise, much to the shock of everyone at the Krusty Krab, especially Squidward, whose eyes shrivel and he says he’s needs to take a shower. While Squidward and Mr. Krabs already found out it was Patrick a couple seconds ago and the fact that they had to see him naked afterwards could easily gross them out, it still paints the picture of a certain outdated trope that is widely seen as offensive to LGBT people nowadays, especially those in the trans umbrella.
