Step 1: Understanding the sentence.
The sentence describes a situation where two people have experienced a disagreement or fallout due to a minor issue. The correct phrase should indicate a rift or separation caused by the issue.
Step 2: Analyzing the options.
- Down does not fit as it is more about direction or intensity and doesn’t relate to a conflict.
- Out is the correct choice because "fall out" is a common expression meaning to have a disagreement or break a relationship.
- Into refers to entering something, which doesn’t fit the context.
- By refers to proximity or method, which does not fit here.
Step 3: Conclusion.
"Fall out" is the correct phrase to describe a disagreement between people.
Thus, the correct answer is 2. out.
Final Answer:
\[
\boxed{\text{The correct answer is 2. out.}}
\]