Lucy wasn't sure exactly how this happened. One minute, Team Natsu was walking through the streets of Magnolia, and the next, they were thrust into a moving vehicle (leaving Natsu frankly motion sick).
None of the conscious members knew what was going on, until the door was opened and light bled through to reveal Master Bob and Mirajane, smiling down at them. Lucy was shocked to hear that Team Natsu was decided by the other guild members to go to Blue Pegasus and serve as members of their musical. Erza, naturally, got very excited. She and Gray groaned while Mira led them to their rooms.
After an introduction to the play, Lucy and the rest of Team Natsu (including Natsu, who revived) were led to the stage, which was set for rehearsal. Master Bob explained the plot: a crossdressing lady (Erza) and the prince of another kingdom (Gray) eloped, and go through many trials to become recognized as a couple in the kingdom. A fairy (Lucy) helps them with their relationship, by guiding them in the hopes of deepening their bonds. In the end, Gray and Erza fight a horrid monster (Natsu). They kiss, and the castle messenger (Happy) lets them know that they are allowed to be wed. For hours, Mira and Master Bob led the rehearsals for the musical.
It was difficult work to constantly sing and dance the whole day, but the mages still thought it was better than the other play. Mira called Erza and Gray over. It was time to practice the kiss scene. Gray quickly got nervous. He had forgotten that particular scene. He wasn't necessarily against the idea of kissing Erza, but the thought sounded odd to him. Erza was quiet and nodded at Mira's instructions.
Master Bob yelled out "Action!" and the scene began. Lucy stood at the side of the stage, smiling and cheering them on (she was almost too good at cheering for the ice and armor mage) and Natsu was on the ground, pretending to be dead while chuckling at Gray's face.
Erza and Gray looked at each other in shock and passion at defeating the monster (Natsu) and enveloped each other in a thankful, tender hug. They moved their heads to look at each other. Gray thought he'd be the one blushing hard while Erza would look casual, but one look at her red tinted cheeks proved this theory wrong.
Gray's eyes widened a fraction, and Erza looked down. Gray almost swore she was staring at his lips. It was time. Gray made the first move and leaned closer for her mouth. Erza sucked in her breath, the tension of the moment made both of their hearts pound. As the last half a centimeter was about to be filled by Gray's lip.
Master Bob yelled out "Cut!" and the two snapped their heads and let go of each other, as if they were teenage lovers caught by an adult. Mira smiled at them (knowingly) and told them that was good, and to save the kiss for the show tonight. Erza silently nodded her head, and shyed away from the stage, all the while avoiding Gray's face. Gray was tempted to freeze his cheeks.
All the while they both thought, "What would've happened if he didn't yell 'Cut!'?"