You still have a logic problem between 1(d) and 7, although we're getting
closer to a solution.

>From the SRD:

1. (d)"Open Game Content" means the game mechanic and includes the methods,
procedures, processes and routines to the extent such content does not
embody the Product Identity and is an enhancement over the prior art; any
additional content clearly identified as Open Game Content by the
Contributor and means any work covered by this License, including
translations and derivative works under copyright law, but specifically
excludes Product Identity.

The problem is still that 1(d) still explicitly excludes Product Identity
from being Open Game Content.  That means Product Identity can't be the
'additional content clearly identified as Open Game Content'.

Here is my suggested phrasing for 1(d):

1. (d)"Open Game Content" means the game mechanic and includes the methods,
procedures, processes and routines to the extent such content does not
embody the Product Identity and is an enhancement over the prior art; any
additional content clearly identified as Open Game Content by the
Contributor and means any work covered by this License, including
translations and derivative works under copyright law, but specifically
excludes Product Identity [add][not clearly identified as Open Game
Content].

Under the new phrasing, I understand the situation to be thus:

This means that 'methods, procedures, processes and routines' (game
mechanics) are automatically Open Game Content and must be marked as such.
Product Identity is automatically NOT Open Game Content, but may be marked
as such if the author has the right to do so.  It is a violation of the
license to NOT identify 'methods, procedures, processes and routines' as
Open Game Content - I like this, it puts the author in an affirmative
position to expose their rules AND protect their setting.

I still have some concern about what happens when they fail to mark game
mechanics as Open, or if there is a difference of opinion as to what
constitutes whether a given set of 'methods, procedures, processes and
routines' embodies the Product Identity.  Who has the right to decide?
Since such an action would constitute a breach of the OGL, it seems an
important question.

-Brad

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