This was the first season produced following Baywatch's first cancellation. The rights were bought by the original three creators and David Hasselhoff, and the budgets were smaller. This resulted in a smaller cast, and overall and very forgettable season. The drama is still fairly serious, although weaker than Season 1, but the show also lacks the glamour that both blessed and cursed subsequent seasons. The only notable holdovers from Season 1 are Hasselhoff, Erika Eleniak and Billy Warlock, with Monte Markham and Greg Alan Williams also returning. There are few noteworthy episodes, although the acting standards are held higher than any of the following seasons with the presence of Markham and Richard Jaekel (who played a similar character in the original pilot show).
Beware, if you are considering buying DVDs from Amazon.com, where they are cheaper, that this season is packaged as Season 1 in the US, because the real Season 1 is not distributed by the same studio over there (it goes way back to first season syndication rules, I believe).