Some historians estimate that in the Great Chicago Fire of

First of all, let me go on record on saying ---- I don't like this question. It doesn't strike me as holding up the standards of GMAT SC. I don't have the highest opinion of this particular source.
https://magoosh.com/gmat/2012/kaplan-gma ... ok-review/

I will also say --- there is nothing black & white wrong about choice (D). The first three are clearly and unambiguously wrong. Between choices (D) & (E) there are shades of grey. The three things make (E) preferable, but two of them are sketchy and wouldn't be the sole deciding split on a real GMAT SC.
(1) in (D) the adverb "earlier" breaks up the verb --- this can be considered "in poor taste", but the GMAT SC is never this picayune. This is not a "stand alone split" that would indicate an answer is clearly wrong.
(2) (E) is more concise --- that genuinely is a GMAT SC standard --- all other things being equal, go with the shorter and more direct answer
(3) the issue of case ---- on the one hand, past-perfect is a way to indicate that one past action came before another past action. Some authors would say --- if some other means (such as dates/times or sequence words --- "before", "after") clearly indicate the sequence of events, then it is redundant to indicate the sequence with verb tense as well. These authors would say the use of the past perfect in this sentence is correct .....
(a) I had already arrived when she made her grand entrance to the party.
.... because nothing else clearly indicates the sequence, but they would object to .....
(b) I had already arrived before she made her grand entrance to the party.
... because both the past perfect verb and the word "before" indicate the sequence, and these purists would say the double-indication of the time sequence is redundant.
I will say --- I absolutely love grammar and grammatical distinctions, but when it gets into this territory, I think some people have too much time on their hands and need to get out of the house more. More to the point, I have never seen this particular distinction tested on GMAT SC. Nevertheless, I believe this distinction #3 is exactly what this particular question is testing, and as such, I think that makes it a relatively poor SC question.

Does all this make sense?
Mike