Red eye is cause by the flash reflecting off the retina in the back of the eye. In darker conditions, the subjects iris opens up to see causing the red eye effect to be the worst. You have several choices:
Increase the light in the room will constrict the iris.
Not using flash in the first place.
Remove the red eye in software. Easy to do once downloaded to your computer, not sure if the SG2 has it built in.