The options for dialogue in this game are represented by pictures rather than full sentences, unlike in the previous game. This is because Lilli does not speak that frequently.
The final restriction is the referee representing "and you must never follow your own wishes". Unlike the other restrictions this one can't be defeated by a Logic Bomb but require a re-modification of Harvey as well as a literal Battle in the Center of the Mind. This is due to two reasons.
This is a fundamental conclusion based on all the other statements and would normally be answered with a "how?" not "why?"
This time you're fighting Harvey himself but you violate the "rules" by questioning them in first place. Hence a need to subvert him first.
Lilli finds the chair leg that Edna used in the previous game and uses it to fend of the phantom. However, Edna can actually burn the chair leg, basically screwing Lilli.
Another one is after Lilli witnesses the truth about what she did to her fellow students made her scream in horror and throw up, making it seem like she was basically traumatized, if for a brief moment.