TV Movie | TV-14 | | Western
A cowboy finds himself betrayed by his best friend and must choose between bringing him to justice and alienating the pretty schoolteacher he is in love with.
The "that" is "son of a bitch". In the era in which the story occurs (~1875), one did not call someone an SOB without expecting to be punched out. It was, however, acceptable for friends to call each other SOBs, in good humor. Hence, "Smile when you call me that."
When Molly and the Virginian are talking about kings and queens while sitting in the grass, her shawl appears and disappears from around her shoulders as the camera angle changes.