I thought everything ended pretty perfectly. There were a few characters whose endings weren't resolved, but that was because there was hope of a season 3 which never came. The actual last 2 episodes were a bit slapdash and forced, but they were rushed to quickly end the thing just in case. As a whole, though, season 2 is a lot stronger, the characters are more fleshed-out, and the story becomes more about the people of Twin Peaks and not just Laura (which Lynch always intended anyway; his original intentions were to never reveal the killer!). Also, season 1 is only 7 episodes, so it's hard to really compare the two, since season 2 has almost 3 times as many episodes and therefor is naturally going to dip below and rise arive as far as quality goes in parts of the season.
Still, both seasons are essential.
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