I double checked, and the correct answer is actually E. Just in case there was a mixup, the correct answer is, "If such explanations were true, Watteau's works would reflect a 'Flemish' sensibility rather than the especially 'French' one these admirers saw in them."
First, let's understand determinism. Line 41: "...deterministic view that the content and style of an artist's work were absolutely dictated by heredity and environment." Why would this be troubling to the French Watteau admirers? Because Watteau was born in a Flemish town. How can he be quintessentially French if this deterministic philosophy is true? This is why E is correct.
C has a couple of problems. First, I'm not sure that Watteau would be excluded from the history of French art. Maybe he wouldn't be so admired, but that seems a little too strong. Also, C makes a claim about "many artists," and we don't really have information to support that.