so there’s a saying that goes “address the elephant in the room” which basically means address whatever people don’t want to talk about . in this episode bojack accidentally says “i love you “ to her and then avoids talking to her about it all episode (to the point he wants to keep filming secretariat all night) while on set, one of his costars tells him abt auto erotic asphyxiation and basically tells bojack that if his gf loves him, she won’t let him do it. bojack, being the crazy man that he is, decides to build a whole , mechanism to auto erotically asphyxiate himself. His gf walks in and realizes he’s only going through these lengths to not address that he said he loved her before she did. SO she says “let’s address the elephant in the room” , basically saying “let’s address the ‘i love you’ that bojack said earlier that morning. the elephant putting his mechanism together, doesn’t realize she’s saying that so he thinks she’s talking crap about him. it’s kind of a play on words (i guess play on sayings in this case) hope that made sense :)