I somewhat agree with Mr. Matt and also disagree to some extent.
I totally agree that the whole point about the "will she sing or not" should not be the sole purpose of the second act as we all know what she does.
However I totally disagree with the comments about Meg.
Having listened to the Aussie bootleg. When Meg finds out Christine is coming to town to sing for Hammerstein she is thrilled at a possible reunion and cant wait to see her again, But Mme Giry is reluctant about it. Thenwhen Christine shows up and it becomes clear she is singing at Coney Island Meg is still happy to see her but only slightly put off that she is not sharing the bill. It is shown also that she is despirate for the phantom's attention (shown in the combination of Only for Him and Heaven bu the Sea). The main thing I think for Meg going off is when Giry tells her that Gustave is the phantom's and he is planning to leave everything he has worked for to him. This in itself says that the Girys thinnk that they are entitled to the fortunes made at Coney ISland and therefore will loose out financially, and Meg will loose out on her mentor since he will not focus on Gustave, so once again in her life CHristine overshadows her.
I also dont see that she goes psycho, she just gets slightly unhinged and kidnaps the boy, and the shooting is still accidental. So to me I can see her actions being plausable (not to forget all the things she has done for the Phantom, prostituting herself and all that)
Mind you I have also gotten past the whole one night stand because I know these things do happen.
As for why the Phantom left, doesnt he explain that in the second half of Beneath a Moonless Sky? although I do agree that it seems a bit odd that he would feel ashamed by what happened. Maybe it was a whole self pity thing and he felt that inspite of what happaned, her life would be better with Raoul. If that is the case then i think with a few lyric changes something like that can be put accross.
http://www.flickr.com/photos/27199361@N08/ Phantom at the Royal Empire Theatre