The PE is attached to a single local site as indicated by 'Local site: CE1-2 (2)' in the exhibit, which shows one entry for the local site. The statement, 'The PE router has the capability to pop flow labels,' is also supported by the exhibit, which indicates 'Flow Label Transmit: No, Flow Label Receive: No,' suggesting the capability to handle flow labels. The statement that the connection has not flapped since it was initiated is incorrect because the '# Up trans = 1' indicates the connection has indeed flapped once. There is no evidence in the exhibit to support a VLAN ID mismatch.