First though, the volume finishes up Squad Seven's mission to The Land of Tea where they are helping Idate, a former Leaf Ninja, win a race that will put a more benevolent family in charge instead of the band of thieves that are currently running things.
While Idate has Naruto, Sasuke and Sakura to help protect him, the rival racer has hired a ninja from The Village Hidden in the Rain, and this particular character, Aoi, is the one that tricked Idate into stealing some of the Leaf's secrets (which rings familiar to Naruto) and convinced the runner to leave the village. Its in the fist two episodes on this disc that we see exactly what happened when Idate's brother, Ibiki (the proctor from the first Chunin Exam) came after Idate and Aoi. We also see what caused Ibiki's scars.
In the end, Sasuke's attempts to take down Aoi are futile and leaves him badly injured, and when Naruto steps in and finishes the job, Sasuke's realization that maybe Naruto has surpassed him starts to hit home. In fact, that's what the third episode, "The Battle Begins: Naruto vs. Sasuke" is all about. Sasuke drags himself out of the hospital and challenges Naruto to an all out battle. As the fight heats up though, Kakashi steps in and halts it before things get too rough. This brief encounter is just a glimpse at the fight that is soon to come, but in the meantime, four familiar Sound Ninja sneak into the village looking for Sasuke. Their mission is to offer him a chance to join Orochimaru and gain untold power.
Of course, Sasuke's desire to take down his brother is one of the main motivating factors in getting better and stronger, and when Sasuke recently ran into Itachi, he was quickly dismissed. Between the Sound's ability to put him in his place, Itachi's disregarding nature towards him and Naruto's apparent stronger abilities, everything seems to be pushing Sasuke to Orochimaru (since it is his curse mark that grants Sasuke brief boosts in strength), but that will have to wait until the next volume.
This disc is a pretty good collection because it starts to bring the rivalry between Naruto and Sasuke to a head and we get a bit of a glimpse of the inevitable fight between the two. These episodes are integral parts to the overall Naruto storyline.