The five-time world champion courted controversy in his opening round win over Zhang Anda by wearing blue trainers due to a sprained ankle and he was instructed by World Snooker to correct his footwear for his match with Davis on Tuesday.
In response, O'Sulivan threatened to pull out of the tournament and posted a picture of his injured ankle on Twitter and the game's governing body allowed O'Sullivan to wear trainers again, saying he would be exempt from "standard dress code protocol" in order to "help manage the effects of an ankle injury".
Liang Wenbo produced the first 147 break of the season on his way to winning a final-frame decider against Tom Ford. Wenbo was a frame from elimination at 3-1 down but fought back to level things up with the maximum before a break of 60 in seventh frame saw him edge through.
Michael White knocked out Ding Junhui after racing into a three-frame lead. Ding replied with breaks of 81 and 86 but a 95 from White clinched the victory.
Elsewhere, reigning world champion Mark Selby was a 4-1 winner against Ross Muir and John Higgins beat Matthew Selt by the same score, while Mark Williams saw off the highly-rated Luca Brecel 4-1 as well.
Judd Trump was a 4-0 winner over Mark Joyce and there were 4-2 victories for Matthew Stevens and Shaun Murphy against David Gilbert and Daniel Wells respectively.