Note: Review expanded from here, and credits to a comment by @BornAgainBrony.

Back in Sonic Rainboom, Rarity showed her vanity, a big flaw to her character that hadn't been shown before. Was her behavior all that positive? Not at all. However, her position was completely believable. For the first time, we watched her gain recognition and attention outside of her comfort zone; it didn't matter if they were staring at her delicate wings or not. So it's easy to see why that vanity-dominant ego influenced her to join the competition as well.

In Dragon Dropped, her envy for Gabby replaces her vanity. She enjoyed spending all her time with Spike and felt jealous of Gabby, fearing that she could lose not only it, but Spike's memories of her altogether. A combination of envy and fear of being forgotten drove her into assuming she must go to extreme lengths to retain contact with Spike. Like in SR, Rarity’s bad side here was thoroughly explored while not making her unlikeable or out of character, starting with the small and working hard as she could to retain the status quo. Several moments add up:

1. Spike initially overhearing Rarity as he wrote his latest note to Gabby, immediately setting the tone of the entire story.
2. The fact that he kept his newfound friendship with Gabby a secret out of fear himself.
3. No one else doing his jobs as good as he, including collecting the gems from the cave without waking the bats.
4. The first montage (which I'll get to in further detail later).
5. Staring crazily at him! (Blink, and you'll miss it!)
6. Not reacting at all after Gabby broke up with him.

But Spike’s broadening horizons by becoming a close friend with Gabby meant he was growing, and his friendships around him were maturing. He spent a lot of time with her and helped her grow into a better pony. But with Gabby now in his life, he can further connect with other species. Like the Dragon Lands, Griffonstone’s reputation isn’t the best; to bring Gabby there helps him understand the decreasing prejudice against dragons and connect with someone on a deeper, more mature level.

So why would Rarity feel jealous of Gabby anyway?

1. Fearing a negative reaction, Spike kept his friendship with Gabby a secret ever since he started communicating with her and pretended it never happened. After Gallus began studying overseas in Ponyville, Gabby began to fly over to Equestria more often, which made it more difficult to keep it under wraps. Pay attention to the initial conversation, and from the visual and audio cues, it looks like it had been building for some time, but the open was the first time she grew really suspicious, because he didn't hear her and admitted to having other plans. Turning down invites was rare, but it looks like it was going to become more common.
2. The montage contained are a few sequences: Spike tasting the best gems, carrying her bags as they leave the shop, and relaxing in the spa together. Throughout those three scenes, we see not only how much they enjoy each other's company, but help and adorn each other, too. Even though Spike carried all those bags, she rescued him as he nearly tripped over a step and waited for him until he could see. My favorite's the spa scene, as Spike enjoyed eating those cucumbers. Juxtaposing perfect scenes from the past with present-day struggles and boredom show us how much she misses Spike. Without his inherent wit and loyalty around, things weren't the same. Watching them enjoy their time while she struggled added extra salt into the wound, especially when Spike ate Gabby's maraschino cherry.

In the past, there was implication that Rarity occasionally took advantage of him, and although I disagree strongly with the complaint, scenes like Rarity teasing Spike for wearing a cute, pink apron for the dragon migration witnessing meant they can't be dismissed. For most of the series, their friendship and his unrequited crush were in his point of view. For the first time, we see it in hers. By focusing their friendship on her, we connect to her beyond the surface and focus on how important his presence and friendship meant to HER. Going back on how she felt she took it for granted calls back those criticisms, and Haber very wisely and cleverly responds constructively to them, making her do things she wouldn’t do if it were someone else. Yet, their strong, series-long bond makes those decisions and actions believable, helping us understand where she’s coming from, even when when she does bad.

And needless to say, she does some very selfish things. Take him along that two-day expedition that only occurs once a year, then a two-day vacation to a Power Ponies convention (Rarity, I've been to BronyCon four times; foot-aching comes with the territory ), and finally a day-long gameplay of O&O. All with complete intention to hogging all the time with Spike away from Gabby and make them forget about each other. She baited him, earned the outcome she wanted, but at the cost of a super-depressed Spike and a Gabby with enormous pain in her heart.

This is why Twilight's presence in Act 3 matters. She's very close to Spike and never saw him like this before. Something was really wrong, and Rarity inadvertently outed herself as the perpetrator. Twilight's quick-thinking and stern disappointment gave her a major wake-up call, solidifying her own doubts of whether they will truly make up or not (suggested by her to start the third act), and making her realize what a massive jerk she was to them both. Friendships change, but it doesn’t mean the good times will end, and she has no business trying to put in effort to "steal" him away when he wanted to be with others.

Yeah, like what @BornAgainBrony wrote, this episode is clearly playing on the love triangle plot and Rarity’s feelings for Spike without delving into the “romantic” part that loomed over the show for so long. Bringing in Gabby to the fold and establishing connections between them was a really great way to exploit how much she meant to him and vice-versa. However, unlike Tanks for the Memories’s death allegory, the stakes in this one and Rarity’s action match the predicament and tone Haber is conveying, whether it’s romanticism or friendship.

Speaking of the connection, how Gabby and Spike began their friendship was a great payoff to a flaw from Fault in Our Cutie Mark. In the former, Twilight’s happy “discovery” of griffons getting cutie marks went unresolved. Haber takes advantage of it, using that hanging plot point to establish their “penpalsmanship.” In their time on screen, they show excellent chemistry.

Rarity was at her most selfish here, and like Twilight in Trivial Pursuit and Fluttershy & Angel from She Talks, she needed to learn how her awful actions affected those around her. In Sonic Rainboom, her vanity nearly cost her her life, but Dash was the lead. In Sweet & Elite, her selfishness put her at risk of choosing her friends and the Canterlot Elite, only to realize what was right when she finally needed to choose. Here, she witnesses these consequences the hard way and was completely responsible for it. Now that she’s much more mature and developed, she can accept the anger from Gabby and disappointment from Twilight better. Swallowing her pride, apologizing to Gabby and Spike, and letting them go on their own after they make up shows her remorse felt genuine.

Dragon Dropped is Rarity’s best episode of the show. If it’s her last, a phenomenal conclusion.