I think he almost completely sees Mary for what she is, but there is still a part of him that wants to believe that she's not completely...is evil too strong a word?

“Cruelty, do you call it? We differ there. No, hers is not a cruel nature. I do not consider her as meaning to wound my feelings. The evil lies yet deeper: in her total ignorance, unsuspiciousness of there being such feelings; in a perversion of mind which made it natural to her to treat the subject as she did..."

He goes on to say essentially that her opinions are/were formed by others and she doesn't know better. I think she does know better and doesn't care. She IS cruel, and she knows she is, she's been very casual about it all along...much like her brother.

Edmund's problem still is that while he is very hurt, and feeling rather foolish (devastated!), part of him still wants to see her as simply a foolish girl, not a woman with her mind made up about her brother, at least. And I think that's normal at this stage in his heartbreak.