We discuss the structure of water at hydrophobic interfaces from the standpoint of its impact on electrokinetic phenomena in microfluidic devices fabricated from hydrophobic polymers such as Teflon (R) or Zeonor (R). Water structuring at hydrophobic interfaces has been described as a source of interfacial charge (see Part 1, this issue), and dewetting phenomena, whether via depletion layers or nanobubbles, contribute to slip and enhanced apparent electrokinetic potentials. issues concerning the impact of hydrodynamic slip and the role of diffuse interfacial structures are discussed. These issues are coupled with each other and with interfacial charge concerns, providing challenges for measurements of individual parameters.