I think it misses the point, namely that Mr. Powell did not then do any better telling truth to power than he has done more recently.
I found this old article (from
http://www.fair.org/extra/9601/powell.html) which seems to support your assertion about the letter:
Whitewashing My Lai
Another rare case of critical journalism was Charles Lane's article "The Legend of Colin Powell" in The New Republic (4/17/95). Focusing on Powell's second year-long stint in Vietnam, the article highlighted research done by British authors Michael Bilton and Kevin Sim in their book, Four Hours in My Lai (Penguin, 1993). The authors had discovered in the National Archives a letter from specialist fourth class Tom Glen, who was a young soldier in the American Division.
In November 1968, Glen wrote a letter to Gen. Creighton Abrams about the American's extreme abuse of Vietnamese civilians and captured Viet Cong suspects. Glen's overall complaints encompassed some of the atrocities later dubbed the My Lai massacre (which had occurred on March 16, 1968). Though Glen included no specific reference to My Lai, he expressed deep concern about American troops who "without provocation or justification shoot at the people themselves."
In early December 1968, Glen's heart-felt letter landed on the desk of a fast-rising officer in the American's 11th Brigade, which included the unit that had carried out the My Lai slaughter. The officer, Major Colin Powell, conducted a cursory investigation and then -- without even contacting Glen or urging that anyone else do so -- dismissed the young soldier's concerns as unfounded. Powell's memo, dated Dec. 13, 1968, was to serve as the basis for the Army's official dismissive reply to Glen's letter. Powell wrote: "In direct refutation of this portrayal is the fact that relations between American soldiers and the Vietnamese people are excellent."
In his account of these events, Lane noted that "there is something missing...from the legend of Colin Powell, something epitomized, perhaps, by that long-ago bureaucratic brush-off of Tom Glen."
I think it's reasonable to assume that despite Glen's letter not explicitly mentioning My Lai, that as an officer in the unit responsible, Powell was likely to have at least heard some scuttlebutt about it, if not well aware of it.
In any event the fact remains he down-played Glen's general accusations in a way that history has proven to be very wrong.
Regards, Albert
PS) the link for the Wikipedia article on Powell I posted earlier is screwed-up, here's a correction:
http://en.wikipedia.org/wiki/Colin_Powell