"It" doesn't refer to season grammatically; are you talking about the "rule" saying that pronouns take place of the nearest noun? If that were true, then there wouldn't be any cases of ambiguous pronouns! I used to think that because I thought I had read it somewhere, but come to find out, that "rule" is definitely not a rule.
Very well put! So, now that we know that proximity is not a factor, we can say that strictly grammatically, the "it" is ambiguous, but that logically, it's totally clear. We could also construct a different sentence in which the "it" stayed in the same place and remained (strictly) grammatically ambiguous but logically pointed unequivocally to "season," e.g.
"The gift shop's morning meeting about the upcoming holiday season took longer than the manager had expected, but it would, after all, be the most profitable time of year by far."
Notice that in the original sentence, even though we've said that strictly grammatically, "it"'s referent is technically ambiguous, even within that strictly grammatical realm, there's a pointer that guides us towards pairing "it" with "meeting," in that this sentence (unlike my alternate example sentence above) seems to be inviting parallel structure: "The meeting took..., but it accomplished..." Since we've got those two past tense verbs eager to line themselves up parallel to each other, letting them have the same subjects is very inviting! So that aspect of the grammar (parallelism) does bias me towards letting "it" be the "meeting" -- and once I let meaning enter my mind at all, I'm fully convinced.
The good news is that it'd be very hard to err in a situation like this, both on the GMAT and in writing in real life. On the GMAT, since you're always picking the best among the options, you will either have an option that eliminates even the grammatical ambiguity entirely or you won't. Such an option, for instance, might be
"The gift shop's morning meeting about the upcoming holiday season took longer than the manager had expected but accomplished more than he had thought possible."
There I've eliminated the pronoun entirely, and there's only one subject ("meeting") that could possibly accompany the verb "accomplished," so if you had this option too, you'd choose it. If, however, you didn't have this option (or something akin to it), the original sentence would be the correct answer.
In real life writing, I'd say you're always fine as long as your meaning is totally clear (unambiguous) and you're not doing anything *actively wrong* grammatically. Actively wrong grammatically would be something such as a pronoun-antecedent CLASH, e.g. using "it" to refer to something plural or to a man or a woman (or such as a subject-verb agreement error). But grammatically ambiguous is only ambiguous, not actively wrong. So while in real life it still would arguably be more technically correct to revise the sentence to avoid the grammatical ambiguity, your original sentence would almost certainly pass any reader's test, I think
This sentence is an awesome example......
