The citizens of Ponyville struggle to see Luna as anything other than the "Mare in the Moon," showing how difficult it is to shake a bad reputation.
Much of the conflict arises because Luna doesn't understand modern social cues and Twilight is the only one willing to bridge that gap.
However, her booming "Royal Canterlot Voice" and archaic mannerisms terrify the townsfolk, who still associate her with her former villainous persona. While Twilight Sparkle attempts to help Luna modernize her social skills, Pinkie Pie leads a group of foals in a game of being "playfully scared," which Luna mistakes for genuine terror . Discouraged, Luna nearly reinstates Nightmare Moon's darkness before learning that being scared is actually part of the holiday's appeal. [S2E4] Luna Eclipsed
Pinkie Pie explains that "sometimes it's fun to be scared," helping Luna understand that the ponies' screaming isn't a rejection of her, but a way of enjoying the holiday spirit.
It is in Ponyville, a holiday where ponies dress in costumes and offer candy to a statue of Nightmare Moon to avoid being eaten. The festivities are interrupted when Princess Luna arrives in person, intending to join the fun. The citizens of Ponyville struggle to see Luna
Dressed as Star Swirl the Bearded (an obscure historical figure no one recognizes). Pinkie Pie: Dressed as a roasted chicken.
Dressed as a Shadowbolt, spending the night pranking others with lightning clouds. While Twilight Sparkle attempts to help Luna modernize
Luna's use of "we" (the royal plural) and her tradition of shouting to be heard provides both comedy and a look into her out-of-touch nature. Costumes: