It's an interesting concept; I don't agree with Mr. Black's rejection of Harry as a candidate for such a story, but it does feel rushed at times. However, I'm also aware that this was originally written under a tight deadline, and only changed a little towards the end to make it portkey compliant as a favor to the H/Hr shippers like me.
This would play far better as a multi-chapter fic, with one or two chapters to set the stage for the original detention, another for the confrontation with Dumbledore and the arrival of a Marley substitute, and then a separate chapter each of the houses. I think I would've let him go thru all three alternates before the "I wish I hadn't been the Boy who lived!" declaration, at which point we could be given a view of what England would be like if Voldemort had won the first time around. That could lead to a Capraesque scene (like where Jimmy's glad to accept whatever comes rather than lose what he has) where he greets his friends with hugs and smiles, apologizes for his behavior and promises to tell them everything, etc., and that evening after dinner when the party is dying down, catches Hermione under the mistletoe to reveal his suppressed feelings for her. But that's just a suggestion.
PS -- It's rather ironic to use "It's a Wonderful Life" as the setting for a Harry Potter fic; after all, the villain of the piece, the unredeemed Ebeneezer Scrooge clone played to perfection by Lionel Barrymore, is none other than...Mr. Potter.
