Lord Falconhand's office seems to have taken the missive with conflicting sentiments... news of Myth Drannor and Shadowdale representatives meeting spreads like wildfire among the farming town. There is much discussion in public places (particularly at the local Old Skull Inn tavern) about the blame being placed squarely in the center of discussion.
The general sentiment seems to be of both shame and outrage. Most elder folk seem to still regard the breaking of the Compact a black spot on Shadowdale's history, and are more lenient or rather interested in what the demands of restitution might be... younger folk seem to be more outraged at the audacity of an Elf Lady dissing their hometown and demanding restitution for some old laws that did not much to protect the town in the darker days.
The shadow of the portal's threat seems to be of more importance, with several people wondering if the elves know more than they are willing to share, or perhaps the Mage's Guild is the foremost authority in the matter.
Lord Azzalar is apparently displeased that the letter's contents have been leaked, and has chosen to remain in his office, but has called forth a town meeting the coming day. ((Wednesday 13th December, probably past 9 PM CST))