It was clear from the time that Peter kept defending Madison to his parents that she was the one he cared for the most. But Madison removed herself from the show before the final rose ceremony, because she feared they were too dissimilar. However, on the way home, she remarked that she did love Peter and wanted to be with him, she just couldn't see at the time how it would work. So Peter decided to propose to Hannah, seemingly believing at the time that he was really in love with her. When he got down on one knee, he kind of brushed over the fact that Madison dumped him, instead focusing on the fact that he was choosing Hannah Ann. In the moment, she didn't catch his incredibly brief mention of the Madison issue, and happily accepted his shady proposal. But back home, everything quickly unraveled.