Control register #4 which sets the PG address of the PG has a different function in mode 2. Only bit 2, PG13, sets the address of the PG (so it's either address 0 or 2000h). Bits 0 and 1 are an AND mask over the character number. The character number is 0 - 767 (2FFh) and these two bits are ANDed over the two highest bits of this value (2FFh is 10 bits, so over bit 8 and 9). So in effect, if bit 0 of control register #4 is set, the second array of 256 patterns in the PG is used for the middle 8 rows of characters, otherwise the first 256 patterns. If bit 1 is set, the third array of patterns is used in the PG, otherwise the first.
The relation PN -> CT is the same as PN -> GT. Each byte in the CT sets the colour of one pixel line of a character. The high four bits set the foreground colour, the low the background colour. If either of these is 0, it is transparent and the colour of the backdrop (BD) is used.
Also control register #3 has a different meaning. Only bit 7 (CT13) sets the CT address. Somewhat like control register #4 for the PG, bits 6 - 0 are an AND mask over the top 7 bits of the character number.
The TC in control register #7 is not used in this mode.