@hermit 

It does seem that this is the only time in the books that Lucy falls into the sin of pride and jealousy.  She is otherwise portrayed in the books as being truthful and honest. I think in other times in the books she is more humble.  Arrogance is her problem only in this part of the story.  Susan may be more attractive than Lucy, but it should not matter to Lucy. It just shows that she isn’t perfect, and the spell does have a temptation for her. She is Lucy the Valiant, but she is only human like anyone else. 

@hermit Really interesting and insightful thoughts there, and I agree with you — although I think vanity on Lucy's part does come into it to some extent, but probably not as much as pride, and I would think quite obviously envy: "And Susan was jealous of the dazzling beauty of Lucy, but that didn't matter a bit because no one cared anything about Susan now."

It's a bit chilling, really, what Lewis tells us in that whole paragraph about Lucy's inner thoughts and darker temptations (some of which Lucy herself may not have been fully conscious of), without saying very much explicitly. I would guess part of Lewis's reason for including this scene is because Lucy has been almost uniformly "the good one" in both the previous books in the series that were written before this one, with us never seeing Lucy face a really serious temptation or even come close to making a significant mistake until now. It balances things out by showing us that yes, she is human, she's as fallible as the rest of us, and even she could have been drawn into doing such a dire thing as saying the beauty spell if Aslan hadn't intervened.

And even after that, she still falls for the temptation to "make up for not having said it" by saying the spell that allows her to eavesdrop on her classmates. That doesn't have nearly as appalling a consequence as the beauty spell would have, but it does leave Lucy with the fear that she has seriously damaged a friendship, and we're left to wonder if (especially after Aslan's reassurance that her friend "said what she does not mean") Lucy was able to forgive Marjorie, and indeed herself. Again, minor in the scheme of things compared with what those pictures on the page of the beauty spell suggested, but it's a more relatable situation for readers — plenty of us may have had times when we found out something that we weren't intended to know, perhaps also through unwise snooping, and it has an impact on our estimation of somebody else. And it just underscores that whole point that Lucy isn't perfect and she also has to live with the consequences of bad choices she's made. Without this entire scene, she'd come across overall as almost a bit too good to be believable.

As for Susan, I'd say we aren't given enough clear information in the books to say for certain what led to her rejection / denial of Narnia. We only hear what others say about her, mainly in LB, along with these few hints in VDT (that she's "the beauty of the family" and that their mother thinks Susan "would get far more out of a trip to America than the youngsters"). In fact, I don't think there are any extended point-of-view scenes for Susan in any of the Chronicles — we never really get a direct view into her own private thoughts and feelings, not for more than maybe a sentence or two, and never at any really crucial point in the narrative that I can think of. So, unlike with Lucy — whose temptation scene that we're discussing is one of the best examples — in Susan's case, we really don't have much solid evidence to go on. We can speculate, of course, but there's very little we can say about her for certain.

Interesting topic. One might recall that Lucy is about 8 years old in LWW, so she’s innocent and youthful. By VDT, she’s about 10 years old, so she’s most likely becoming insecure about her looks. 

I think it also shows that even the beloved characters aren’t without faults, which actually makes them more relatable. I think Lucy is struggling with all the attention Susan gets (which sibling jealousy is kind of a recurring thing in the Narnia series). 

VDT is actually like a journey book where each character face various temptations and Lucy’s no exception. 

The Dawn Treader Walden film actually made Lucy turn into Susan, which is something not found in the book. Lucy is jealous of Susan’s good looks, but there was no need for that transformation. The temptation as described in the book was enough. What she said in the story was enough to convey her attitude.  I also would have liked a stronger rebuke from Aslan than “You doubt your value.”  The jealousy of Lucy’s behavior and Aslan’s correction wasn’t emphasized enough.  It looked interesting enough with the mirror on the ship, but the scene could have followed the book more closely.

What an interesting topic. I had been reading some commentary on the problem of Susan recently (as people call it, not that there are any) so it helped me better understand this. 

Lucy had always seemed to me as the one full of faith in Aslan but regardless of faith, her like us are tempted by desires. In VDT she is still pretty young but it could be implied she "ages" (Narnian time and memories are weird) and remembers everything. 

Anyway, as @jasmine_tarkheena referenced, VDT is a story about temptations and desires and what people do to handle them.