In the underground factory, mechanics touch the damaged Layzner and accidentally trigger Fouron and V-MAX. Fouron tells Eiji that it can no longer protect itself and must destroy itself to prevent misuse by outside parties. Eiji explains that they can both fulfill their missions if Fouron transfers over to New Layzner, which Fouron accepts. Le Cain returns to Grados Tower and angrily demands that Gresco explain why he sent Karla to interfere during the battle with Eiji. Le Cain wonders if Karla acted on her own and whips her when she tries to speak up for herself. He then demands to know where Julia was taken, so Gresco signals Karla to go get her. Gresco summarizes Le Cain’s view that Gradosians are superior to Earthlings and that better rule is provided by better people. Julia walks in and tells Le Cain that he’s wrong because Gradosians and Earthlings are equal. She states that the ancestors of Earthlings and Gradosians were the same, but Le Cain doesn’t believe it and tells her to shut up. Julia explains that Gresco interfered with the battle and had her hidden away because he was afraid of Le Cain learning the secret and being shocked by it. Le Cain thinks she’s lying, but Gresco confirms that everything she’s saying is true. Gresco explains that everyone who holds power in Grados eventually learns the secret. He adds that to rule others, you have to first recognize yourself as evil and know that millions have died so that you can maintain power. Le Cain thinks those who rule must be superior, and Gresco asks what that means. Gresco states that to rule people is to have power over them, and therefore power is evil. He adds that to rule, you have to remain detached even after learning the truth. Gresco realizes that Le Cain is too immature to be a general of the occupation. Le Cain reiterates his belief in the rule of the superior, and Gresco counters that even a fool can rule others. Le Cain accuses Gresco of fleeing from power, which upsets him. Gresco thinks that he sheltered Le Cain too much as a child and dismisses him from his post. In a fit of anger, Le Cain pulls out his gun and shoots Gresco in the chest. Despite the mortal wound, Gresco stands up from his throne and takes the gun out of Le Cain’s hand, which he then uses to shoot Karla in the head. He falls to his knees and states that this is for Le Cain’s protection. As he dies, he begs Le Cain to keep the secret of Grados’ origin and kill Julia.
During Gresco’s funeral, Gunstaids fire their cannons in salute to the fallen leader. Le Cain addresses a large crowd and vows to create an ideal nation for Gradosians and Earthlings. He calls Roanne to the stage and promotes him to his second in command, explaining that from now on he will acknowledge anyone who is superior, regardless of origin. Le Cain mentions a religious belief on Earth that holds that all things can be purified by fire, so he decides to do that in New York. Gunstaids and Terminator Police are deployed across New York to level the entire city and replace it with a new city that reflects Le Cain’s ideals. Without Gresco to hold him back, Le Cain embraces the role of the dictator. To prevent interference from Grados, Le Cain destroys the warp station and flagship in orbit. His reckless actions displease ranking Gradosian officers who don’t want to be stuck on Earth. At the underground factory, mechanics wrap up their work on the Dolls. Simone tells Anna that Elizabeth suffered a psychological breakdown because producing weapons conflicted greatly with her pacifist beliefs. David asks Eiji what he thinks, and Eiji answers that the current situation is unacceptable. Le Cain has his soldiers gun down the Gradosian malcontents who are plotting against him. At Gresco’s tomb, Le Cain tells Julia that Gradosians are accusing him of murdering his father, and a new commander has been sent to Earth from the home world. Le Cain muses that the way things are going, his ideal state may be nothing but a dream. Le Cain blames Gresco for everything since he encouraged him to be proud of his heritage. Le Cain cries and yells at Julia to pray for both him and Gresco. Arthur takes Roanne outside the Tower and asks him if he really is just pretending to be Le Cain’s servant. However, Roanne denies everything and warns Arthur to stay loyal to Grados if he wants to live. Arthur gets angry and accuses Roanne of being a traitor, but Roanne counters he’s just working for people who appreciate his skills. Julia tells Le Cain that the time has come for them to part and walks away. Le Cain demands that she stay, but no one blocks her as she calmly walks out of the Tower. Elizabeth grabs a machine gun and wildly shoots up a computer until David stops her. She sees no point in killing and says that no amount of SPTs they build will defeat Grados. Elizabeth pleads with David to let her destroy everything and falls to the floor. Simone recalls that the Cold War was the egoism of nations, but David notes that this is a fight for freedom. Anna wonders if there’s any other way to end things besides killing each other.
Eiji meets Julia in the rubble of New York and tells her that everyone agrees it’s meaningless to just fight. Julia asks Eiji to take her to Cuzco so they can borrow the wisdom of the ancients to use against the arrogant and powerful. New Layzner and all the Dolls fly out of New York, and Julia tells everyone the story of how ancient Gradosians were dying out 40,000 years ago. They came to Earth and used the DNA of humans to reinvigorate their species, thus creating modern Gradosians. To prevent the two species from meeting before they were fully developed, the ancient Gradosians left behind a safety system on Earth inside the ruins of Cuzco, which Julia calls the Seal of Grados. Julia doesn’t want to use the Seal of Grados, but she realizes it’s the only way to stop Gradosians from needlessly killing and Earthlings from fighting a hopeless battle. She asks Eiji to protect her until the preparations are complete and is then teleported inside the ruins. David sneezes from the nighttime cold, so Simone brings him a blanket. David holds Simone’s hand and tosses the blanket over to Anna so she can share it with Eiji. The next morning, a large force of Gunstaids marches on the Nazca Lines and fire missiles on the Dolls and New Layzner. A Dtol squad appears from the rear and joins the attack. David and Simone destroy multiple Gunstaids, while Eiji takes to the air to fight off the incoming Solomcos. Eiji uses V-MAX to outmaneuver the Solomcos’ missiles and disable them. On December 31, the resistance fighters pull back to around the Cuzco ruins in the face of the overwhelming Gradosian advantage. Le Cain can see where the battle is going and decides to leave Roanne in charge of the operation while he gets some rest. At Cuzco, David asks Eiji why he’s wearing his spacesuit, and Eiji answers that he’s leaving to protect the Seal of Grados. The ground starts to shake as the Seal emerges, and Anna runs over to Eiji to hug him. The cylindrical Seal breaks out of the ruins and heads for space, escorted by New Layzner.
The Gradosians call the Tower and request orders to attack the Seal and New Layzner, but Roanne does nothing. When his men press him to act, he instead orders the ground forces to retreat. Roanne shoots a man who tries to rush him and declares that the Tower is now under the control of the Earth Liberation Front. A light beam signals the resistance fighters outside to begin their attack and raid the Tower. Le Cain reflects on how the ideals he killed his father to protect are crumbling around him. Roanne asks Le Cain to understand since he’s an Earthling. When the Zakaal arrives, Le Cain tells Roanne that he’ll let him live until he returns. Le Cain takes off and activates V-MAX to fly into space. Julia tells Eiji that humans are just infants in the vastness of the universe, and she places her pendant in a console, which activates the Seal. Le Cain appears and demands to know what’s happening, but Eiji refuses to answer. Le Cain activates the “red power” super charge, so Eiji uses V-MAX to keep up with him. The two SPTs move at high speed around the Seal and trade fire. Le Cain punches Eiji and knocks his rifle out of his hand, forcing Eiji to evade him. Le Cain asks again what’s happening, but Eiji responds only by punching him. New Layzner and Zakaal nearly crash into the Seal and are transported inside. Julia tells Le Cain that she’s going to stop senseless fighting because no one can use their power in here. She explains that the Seal will distort the space around Grados and Earth to prevent travel between the two because it’s the only way to end the fighting without further bloodshed. Le Cain tells Julia to stop, but she answers that all she did was follow the commands of the being who is superior to all else in the world. Julia tells Le Cain that trying to fight will only show his impotence, and when he tries to fire his rifle, it has no power. Le Cain jumps out of his cockpit and floats down to strangle Julia, but Eiji slams into him and punches him repeatedly. Le Cain yells that he won’t let Eiji and his filthy blood get in the way of his ideals. Julia intervenes and tells Le Cain to calm himself, and he regrets showing her mercy earlier. Julia tells Eiji to return to Earth while she stays with Le Cain and activates the Seal. Eiji wants Julia to come back with him, but she explains that after space is sealed, it could be hundreds or thousands of years before Earth and Grados have contact again. Julia opens Eiji’s fist and tells him he doesn’t have to be angry anymore. At Julia’s command, Eiji, New Layzner and Zakaal are transported outside the Seal. Julia tells Le Cain that she’ll pray for him and activates the Seal, which emits waves of light over Earth as it distorts space. As Eiji floats in space, Julia’s voice tells him to help the Gradosians on Earth since he represents both worlds. Eiji thinks about how beautiful Earth is and calls out to Rei. Rei picks up Eiji on sensors and uses V-MAX to fly over to him. Everyone waits at Cuzco, and Arthur spots the light of New Layzner approaching from the horizon. Anna runs ahead of everyone to greet Eiji and kisses him when he dismounts from New Layzner.
Layzner‘s TV ending was a casualty of cancelation and ended up being a disjointed mess that skipped over major plot points, but this OVA completely fixes that. In essence, it adds a full episode’s worth of story the events before episode 38 to fill in the gap. It also adds to the events of episode 38 to provide a proper ending. The transfer to New Layzner is explained, and a long scene shows Le Cain killing Gresco and seizing power. The purpose of the Seal is explained, as is how everyone ended up in Cuzco before the start of episode 38. We also see Eiji and Le Cain actually fight each other, which wasn’t shown in the TV version. Their conflict inside the Seal is new, as is Eiji’s return to Earth. Thankfully, the cast reminiscing over old clips has been removed because it really serves no purpose here. So Le Cain commits patricide because, as Gresco expected, he couldn’t handle the truth that Gradosians and Earthlings are completely equal. For all his cleverness, Le Cain is trapped in a ridiculous bit of circular reasoning: only the superior can rule, and people can rule only because they’re superior. Rather than abandoning this faulty logic, Le Cain tries to adapt the truth to his rigid beliefs by promoting Roanne and claiming that he’ll acknowledge anyone who’s superior. In the end, it turns out that there was simply no other way to stop the fighting other than to forcibly separate Earth from Grados. It’s a fitting ending for this series because there’s no easy solution to the problems of racism and oppression. An untold number of Gradosians are now stuck on Earth, and I’m sure not all of them will immediately give in and embrace their former subjects as equals. I don’t know how Takahashi would’ve ended Layzner if he had his full run of episodes, but this OVA does its best to provide a solid ending, given the circumstances. Don’t even bother watching episode 38 unless you want to experience an exercise in frustration over how a cancelation can impact a series. This OVA is the true ending.