Basically Vash kills Legato and gets very very depressed. He kills Legato because the asshole is controlling people using his mind skillz. These people are about to kill Meryl Strife (the short one) so killing Legato is the easiest way to stop these people. Legato urges Vash to kill him, purposefully having put him into this position because he knows how much this will torment him. As you might know, Legato is a human but he has Vash's arm which gives him interesting powers. Vash and Knives are the "beings that live outside of time", as well as the beings that reside within the "plants" which power the cities and the Seed ships. The Anime doesn't go into depth about this very much but in one of the episodes you can see Vash pouring out some Liquor in respect of a Plant that doesn't work anymore, showing that the being inside must have died. In a later episode he calls one of these beings within a Seed ship Plant, "little sister", shortly before she is killed and the Seed ship plummets to Earth.
Anyway, eventually Vash gets over his killing Legato because Meryl talks sense into him. He begins to see Meryl as Rem and snaps out of it.
The last episode is basically a filling in of everything that happened from when the Seed ships landed on the planet after Knives sabotaged them and killed Rem. It also shows that the guns were crafted by Knives and how Vash lost his arm and then destroyed July city with the Angel gun, without meaning to. The guns were made to eradicate the humans that survived and it took Knives about a year to make them within a Seed ship, while Vash waits outside, alone. Shortly after, Vash shoots Knives and runs away.
Vash tracks down a relative of Rem but when he finds him, the man is lying dead with a bullet in the head, with Knives sitting next to him.
Vash goes to shoot Knives but has his arm shot off here. My signature says what Knives says to Vash at this moment
Eventually after the filling in and tying up of almost all the loose ends, Vash gets the courage and determination to kick Knives' ass. During the fight, Knives suddenly seems to have the upper hand. He suddenly gets both his Angel gun and Vashs Angel gun and aims them at Vash. Wolfwoods voice comes to Vash (who died in an earlier episode). Vash picks up Wolfwoods cross, which he brought with him but forgot in his fight with Knives, and uses it to shoot Knives. Knives doesn't die and Vash carries him off into the sunset, fulfilling Rems wish for Vash to take care of Knives.
The End
Anyway hope that wasn't too complicated.
I recently heard they were going to make a movie for Trigun.. I really hope so.