If not for C.C. walking in on them, Maxwell and Fran would have done it in the hospital bed next to Niles. After the fact, Fran is encouraged that finally something is happening between them. Maxwell on the other hand is still uncertain, and gets some glib advice from Niles to preoccupy Fran with some meaningless project, like redecorating a room, to give him more time to figure out what to do. Fran sees right through what Maxwell's doing. Sylvia sees Maxwell's ploy as letting Fran into his life and his home, especially as the room in question is the sanctuary: the kitchen. Fran initially wants to do all the work herself, much like Maxwell's first wife, Sarah, did with the house, but Sylvia convinces Fran to enlist the help of Fran's flamboyant decorator cousin, Sheila.
