"Susan could always lie to Peter. Could lied, would lie, did lie to Peter." - 'could lie' or 'had lied'?

"They were children, she was a child, and it must have been her imagination. They were playing a game, nothing more, and she's mildly horrified that she could have dreamt up such a awful, perverse role for herself in a game." - 'an awful...' yeah?

Ooh, well done all 'round. The political maneuvering that Ed and Susan do really fit in well. Susan's mental adjustments flow pretty believably. And ooh, the Ed/Caspian tie in. *tear*