There are a number of theories as to why. Most prevalent is that Colt collectors didn't want the C series 2nd Gens to be passed off as originals, so the O was added to keep that from happening. The O was discontinued in 1973 around SN 11000
I think we're talking about two different things. Is the one you are talking about with the O a 2nd Gen 1851 Navy? If not, ignore my previous reply.
Don't know what the 2s would be.
It's probably an internal factory inspector's mark. Various numbers and letters have been noted on London Colt components.
(the late J. Rosa, Colonel Colt, London)