Dr. Iannis packs his pipe with nasty tobacco and vows to quit smoking. He writes that Cephalonia has always been home to great and powerful men. He wonders if his problem with his History is that history is actually impossible. Forgetting his vow to not smoke he draws on his pipe, only to cough and sneeze. He hands Pelagia his tobacco tin and asks her to mix it with honey and brandy, but asks her to sit first. Dr. Iannis notes that Pelagia and Corelli are obviously in love with each other. He notes her blush, takes her hand, and "diagnoses" her as being in love, which he says is making her stupid.
By diagnosing Pelagia as being in love, Dr. Iannis attempts to make something very emotional into something that's rational and easier for him to talk about with her. It's important to note that during this conversation, Dr. Iannis never truly talks down to Pelagia or tells her what to do. This is another indicator that he sees her as a person capable of making her own decisions; he's only making sure she has information.
Dr. Iannis squeezes Pelagia's hand and says that it's a simple fact that a family's honor is based on the conduct of its women. He admits that he likes Corelli a great deal, but reminds Pelagia that she's engaged to Mandras. Dr. Iannis insists that this will make people hate her. Then, he says that love is only "a temporary madness," and the true test of whether love is real or not is if two people are entwined with each other after the rush of initial attraction wears off. He admits that he'd be thrilled for Pelagia to marry Corelli after the war is over, especially since Mandras might be dead.
Even though Dr. Iannis has raised Pelagia to be independent and thoughtful, he recognizes that she's still going to be hindered by a society that doesn't believe women should be that way. In doing so, he shows he understands that he didn't raise Pelagia in a vacuum; she's still a part of Greek culture even if she's grown up differently than her female peers did.
Dr. Iannis tells Pelagia not to be ashamed, but says he's aware that she and Corelli are sexually attracted to each other. He says that he wouldn't help her with an abortion if she became pregnant, and points out that women who have babies with the enemy often end up as prostitutes. He reminds her that Corelli may have any number of venereal diseases because of the army prostitutes. Pelagia cries and accuses her father of making everything awful, but Dr. Iannis insists he's not forbidding anything, just telling her to be careful and act honorably. He tells her to pray for Greece's liberation and apologizes for upsetting her.
By essentially asking Pelagia to wait until after the war to move forward in her relationship, Dr. Iannis recognizes that while the war brought Pelagia and Corelli together, now that they are together, the war will deny them their happiness and insist that they think of each other as less than human and unworthy of each other's love.