"Yes, the meeting described indeed happened. Yes, we talked about what Arrington claimed we talked about. No, Arrington was not welcome. No, it was not the big deal Arrington claimed it was."
If it was not the deal that Arrington claimed it was, then why were they so uncomfortable when Arrington sat down? Why did Sundeep delete his tweet? And why did people tell Arrington that they were uncomfortable with the direction the conversation took?
This leaves me more, not less, likely to believe what Arrington reported. The side evidence leaves me leaning towards the belief that Dave McClure's judgment is more likely lacking than that there is no fire behind the smoke. However I have no really concrete evidence behind that position.
It will be interesting to see this play out.