I had the exact same question and initially picked (C) however I understand why (D) is the correct answer instead of (C).
Magazine editor says "To remain an effective advertising vehicle we must have loyal readership, and we would soon lose that readership if our readers suspect that our editorial integrity has been compromised by pandering to advertisers." - this means that changing the policy would actually lose readers, fewer people would buy the magazine. If they don't buy the magazine, they won't see the ads.
The advertising sales director misunderstands her argument, and makes a counterargument about how readers view the ads. Hence (D) is the correct answer because the sales director fails to address the point about the lost readership i.e. the magazine editor's argument "does not depend on any assumption about readers' response to the advertisements they see in the magazine"
