Answer:
I would say the correct answer is B. Character versus character.
Step-by-step explanation:
This passage serves as foreshadowing of the huge conflict between Sara and Miss Minchin that is about to evolve and get worse throughout the novel. Miss Minchin acts hypocritically - she dislikes Sara yet praises and glorifies her because of her father's money and prestige.
We don't see any traces of Sara's conflict with society, even though she is very young and has yet to find her place within her new social circle in the boarding school. And she certainly doesn't show any signs of a conflict with herself. Even though she is aware of her own virtues and advantages, she is nevertheless a down-to-earth little girl who never lets herself feel or act entitled. At the moment, she is obviously at peace with herself and her surroundings - except for Miss Minchin.