This was a very good episode. One thing I was surprised at was that they didn't try to turn the cloak on on the Pegasus and get that ship out of there, or even see wha she looked lke.
As to why the ship passed through objects, I;m reminded of "The Next Phase" where Geordi and Ro are ale to walk through doors. wals and humans.
Also a good book on the Treaty Of Algeeron and why the Federation signed it I :Serpents Amongsrt Th Ruins:.