I'd have to say that it's a toss-up for "best episode ever" between these two:
2. The hour-long Thanksgiving special when Jerry gets to fly first-class and Elaine is stuck back in coach.
I still think that the yadda yadda yadda episode was one of the better ones I've ever seen. And the funny thing was, the yadda yadda yadda part of it was NOT the funniest part of the show. It worked well in so many different ways adn in different levels of humor. It's one show that stands up SOOOOOO well on it's own. IT uses the characters, and the background we know of them, so as a part of teh whole it was great... but it also had repeticous behavour within the show of the character so that, if watching for teh first time, you would find the character of each player immediately, and still laugh. It was one of the most well crafted shows I've seen.