Yes, but when Regina went “oh, I just took that money to build a playground”, everyone was like “that’s all right then, YOU ARE SUCH A SAINT REGINA”. But that’s not how it works. You can’t take money from the city without permission. Even if it’s to build something good, you need approval from the council. Now, I can believe the people in Storybrooke under the spell wouldn’t know that (or care about it), but Emma WOULD know about it. 

Basically, I would have liked it more (and I think it would have made more sense) if, after Regina shows the plans for the playground, Emma had said “but you still took the money without permission, that’s still illegal/bad!”. The town is under a spell, so they probably wouldn’t have cared, but Emma is not and she shouldn’t have been convinced :/ I don’t know if I’m explaining this right.

Yes! I hope so too. It’s just stupid of Emma to be so trusting, and Emma is NOT stupid. So I hope we’ll find out she knew all along. 

Well, more specifically with the Emma storyline (the FTL storyline was fine):

• Three episodes earlied (Desperate Souls) they made a point that Emma wouldn’t do anything wrong to get her way (in the election episode, she exposed the fact that Mr Gold was the home who started the fire even though she had nothing to do with it) and in this episode she breaks into Regina’s home and steals documents. I have nothing against Emma stealing the documents if the writers had handled it right (maybe they could have made a point that Emma was changing her mind, realizing that the stakes were too high to play fair, etc), but I thought they didn’t and Emma acted OOC.
• The whole “Emma confronts Regina” scene was cringe-worthy and made no sense. Even if Regina had taken the money to build a playground and not a mansion for herself, you still *can’t* do that without permission. What Regina did was still illegal, and it was stupid of Emma to go “ooops, you had good intentions, my bad” - NO. She still took the money without permission. Even if she had taken it to save homeless pregnant women, she did something illegal and Emma was right.
• Maybe they’ll explain it later and reveal that Sidney is double (triple?)-crossing Regina, but why wouldn’t Emma’s lie-detector “ping” when Sidney declared himself her ally at the end?

Basically, I thought the whole Emma/Sidney/Regina storyline was a mess.

No, the Genie used all the wishes. He had one left, and he used it to wish to “be with Regina forever” (which got him trapped in the Mirror). The first two wishes by Leopold were 1. for the Genie to be free and 2. for the last wish to go to the Genie. So that’ three! :)