Just as they're having a talk with Kenneth's daughters, someone unseen walks by and uses a (Spanish) homophobic slur, directing it at Kenneth and Armando.
At least one of Kenneth's daughters heard it all on her own, but Kenneth missed it. Kenneth wishes that he had heard it and knew enough Spanish to say something back, but Armando (precious Armando, who must be protected at all costs) doesn't like the idea of Kenneth getting into a potential fight.
Speaking of a fight
Taylor and Cassidy are FUMING. Kenneth's daughters are adults and we have to imagine that this is not the first time that someone has said something awful about their dad. One of them wishes that she could punch the slur-spewer in the mouth. Can they get their own show when they just put on body armor and fight homophobes?
Armando isn't even angry
He's sad and this is exactly what he was afraid would happen -- the same fear that has kept him in the closet for the first three decades of his life. He's afraid of PDA with Kenneth. He's afraid of violent retaliation against him, his fiance, their property. They won't always be a party of four followed by a production crew, and he knows that. Armando deserves a better world than the one in which he is living.
Hate speech is not just mean words. Hate speech is a reminder that physical violence could come anywhere, at any time. Slurs are a reminder that some people do not see you as human. And as you can see, particularly with Armando, they're used to force people to try to hide themselves for the "comfort" of bigots. No one deserves to be treated like this.