The two excerpts that indicate the aunt is unaware of her flaws are:
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“It’s a very difficult thing to tell stories that children can both understand and appreciate,” she said stiffly.
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“A most improper story to tell to young children! You have undermined the effect of years of careful teaching.”
These excerpts reflect her belief in her authority and ability to teach children, highlighting her lack of awareness regarding the appropriateness of her own stories and her self-perceived role as a caregiver and teacher.