I've actually studied and read multiple books about the real Lincoln County War and the historical Billy the Kid. Both movies take huge liberties with history, so let's just first establish that neither movie is historically accurate. I would judge the first one as being a little more historically accurate, but I don't hold that fact for or against either film. I can enjoy historical fiction for what it is.
I absolutely love the first Young Guns film. It is one of my all-time favorite movies.
Regarding YG2, I have an opposite view regarding its quality as a sequel. It is a terrible sequel. It is nearly completely unrelated to the first movie. The only ways it is like the first film is that it has a similar setting and three common characters played by the same actors.
In the first film, the Pat Garrett is not really a friend of Billy's. When Pat tracks the gang to Mexico and confronts Billy, he tells him that they have asked him to run for Sheriff of Lincoln County. Then Billy tests him by turning around and asking Pat if he was his "friend". Since there weren't really friends, this means that he was really asking him if he was his enemy or not, giving Pat the chance to shoot him in the back. Billy is in the foreground but even with Pat being out-of-foucs in the background, you can see that Pat does reach for his gun as if considering to shoot him or hold him at gun point to capture him. Then Pat decides not to at that time and lies to Billy that he is his "friend."
But in YG2, Pat is truly a close friend of Billy's and a part of his gang before becoming Sherriff. Of course the reason that they changed this is because they were going with the radical "Brushy Bill Roberts" theory that Billy the Kid was never actually shot dead when history records, so the explanation is that Pat Garrett really did let Billy go out of his love for him.
Which brings us back to the end of the first film. The voice-over narration provided by Keifer Sutherland was not actually portrayed as 'what history records about the fate of the surviving character but may have not really happened after the events shown in the film'. The narration takes place within the fictional continuity of the story. That means that Doc did not ever come back to New Mexico from New York. The Doc character from YG did not die in New Mexico. Billy from YG was really shot and killed by that film's Pat Garrett, and Doc was still alive when that happened. Chavez also did not die before Billy, although he did come back to New Mexico after Billy died to chisel the epitat "pals" on Billy's tombstone (It had to be Chavez and he was the only survivor of that conversation in the desert about Billy declaring that their small gang of "pals" formed a sacred hoop as Chavez's new "tribe".)
But in YG2, Doc and Chavez are captured, brought back to New Mexico and died before Pat Garrett didn't shoot Billy the Kid in the dark. All this means that YG2 totally sucks a sequel. And people think that Star Trek has continuity problems!
I find that the only way to enjoy YG2 at all is to not look at it as a sequel. As a movie with a self-contained story on its own right, its OK. I don't love it, but I don't hate it. I just wish they hadn't called it Young Guns 2. That was strictly to captialize on the success of the first film (which had a net gain of over $30 million). They could have still called it something else with "Young Guns" in the title somehow, but the second film is definitely not what the title implies that it is.
I view the two films as taking place in alternate realities from each other (which of course are both alternate realities from our real world's history).
