Follow me on this one, it actually works within canon.
During the first command briefing, Loukakis identifies himself as a Captain, but once on the Aquitaine, he's a mere Lieutenant. Now a one-rank demotion might be explained through any misconduct or incompetence, but we're talking THREE ranks here...Might as well just give the guy a Bad Conduct discharge or something...So I think there's a much simpler solution.
Alpha 1 is not on the Aquitaine during that first CB. He may be on another warship...or maybe a transport craft.
Maybe this transport craft is commanded by Loukakis, which WOULD effectively give him the rank of Captain aboard his vessel according to Navy tradition.
There ya go - the first and biggest canon inconsistency in FS2 neatly fixed