The situation is the raw circumstance or context: the plot, the events, the predicament the writer is in. The story is the emotional experience that preoccupies the writer: the insight, the wisdom, the thing one has come to say, which is what gives the situation its meaning.
In nonfiction the writer must construct a reliable narrator out of their own self, a deliberately shaped persona that is a truth-speaking instrument rather than the whole messy person. This fashioned self decides what the material means and is the single most important element in holding a piece of personal writing together.
Memoir fails when it is mere self-exposure or settling of scores; it succeeds only when the writer has achieved enough distance to know what the experience means and is using the self to illuminate a larger subject. The reader must trust that the narrator is after self-understanding, not self-justification.
Gornick reads Gosse's memoir of his rigidly religious father as a case where the narrator achieves a steady, compassionate distance, treating the father not as a villain to be blamed but as material for understanding a clash of temperaments and eras. The book works because the narrating self has grown beyond the situation enough to make sense of it rather than merely recount the wounds.