Add my own little "cool/awesome/brilliant" comment here because this IS all sorts of coll/awesome/brilliant. Dudley's little jealous comments about Hogwarts and the wizarding world is painfully sweet, a very innocent type of jealousy. The way you've portrayed Lily and James makes me think that this Dudley won't turn out to be a bully; in fact, the opposite may be true.
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Thanks so much for this lovely little AU!