When you say you had a hypo, I wonder what you actually mean. Did you become ill, unable to function? Or did you simply feel ready for lunch and note that your blood glucose was just under 4. Just under 4 is not generally considered to be a hypo, it is within the normal range, but may feel low for you, because your body is used to rather high readings. However, if you are on insulin, or insulin stimulating drugs (I think Gliazide is one of these), you are supposed to be higher to drive, this is so that there is a "buffer" if your levels begin to drop.
You say you had a breakfast of non-sugary cereal. Do you mean you had something like Weetabix, rather than Sugar Puffs (or similar)? Any cereal will break down into sugars in your body, though the likes of Weetabix may take a little longer to break down than the sugar coated ones or ones with dried fruit in them.
You have probably been getting down to just under 4, because your medications are coping effectively with the amount of sugars you have ingested (and released from your liver) at this time of day. Perhaps you should think about how much sugars and carbohydrates and starches you are having at other meals, a reading of 16.3 is much, much higher than is advisable.
if you want to take control of your health and sugar levels, testing regularly, before and after meals, to see what effect different food stuffs have, is absolutely essential. Many on this forum have found that, through testing and coming to understand their response to foods, they have been able to reduce and even totally give up diabetic medications. Do have a good look round the forum and associated site, there is lots of information there and lots of people who will answer your questions.
Sally