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Sounds like an oxymoron? Not really. Having had standard rejection letters from 'The People's Friend' in the past, I was very encouraged this time by being told exactly where my story fell down. Progress indeed!
Not only is it a good sign, it's excellent that you're TAKING it as a good sign. I've seen far too many writers respond to non-standard rejection letters with howls of outrage at having their work "shredded" and "attacked". You'll do just fine, Mono :)
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gary and Carol :O)