Okay, seeing as how this story arc takes place a long time in Peter Parker's past, it's a fair bet that Spider-Man and Jonah didn't perish in last issue's explosion. Especially since there was no explosion, just another of Mysterio's special effects. Jonah, of course, is his old blustery self, trying to convince Spider-Man he knew the whole thing to be a put-on, yet the merest suggestion that Mysterio had tape of the whole session sends him on a frantic search of "Hell's" control room while Spider-Man swings off after the bad guy.
Meanwhile, on the sphinx, Betsy Schneider is desperately trying to believe that her childhood friend didn't just murder several people. Mysterio assures her of the truth and Betsy kisses him for the second straight issue (the guy wears a giant bubble to work and he's still getting more action than I am! Life's just not fair.) However, her suggestion that she write a book about his career sends him into a paranoid rage. Believing that Betsy's only using him to make a quick buck, Mysterio is stopped only by the appearance of Joe Smith, who has finally managed to crawl up to the top of the sphinx. Joe's attack has no effect on Mysterio, who swats him off the sphinx and lets him fall to his death. Almost. Spider-Man just happens to be in the right place and snags him before he makes a really big hit on Broadway.
While Jonah returns to the Daily Bugle and confronts his own feelings of inadequacy, Mysterio plops his sphinx down in the middle of the street and activates a virtual reality machine that transforms everything in a five-mile radius into ancient Egypt. He offers Betsy his hand in marriage, life in a "virtual universe," but by this time Betsy has had enough of Beck's pretending and refuses. Their discussion is cut short by Spider-Man's appearance, and Mysterio knocks her into the belly of the sphinx to concentrate on his foe. The two battle while appearing to transform into everything from a wild, wild west shootout to a pair of fish and even math equations (I guess we're back in hell!). After finally remembering to trust his Spider-sense, Spider-Man closes his eyes and fights through the illusions with little difficulty.
Mysterio doesn't take this defeat very well, and keys in the standard issue self-destruct sequence. Five city blocks will be atomized by the explosion. But Joe Smith has found his way into the sphinx, and after finding true love in the eyes of Betsy Schneider, he bravely disarms the machine by. . . pulling the plug? Hey, whatever works. Spider-Man takes the opportunity to whup Mysterio, sending him flying through the front window of a toy store, and that pretty much wraps things up.
Oh, and as for Jonah, he gets publicly humiliated a few days later when tape of his time in hell is aired on every network. Ouch.