Example:
The world had turned into a messy blur, and I was caught in the middle of it.
Is this grammatically correct?
Or should it be instead
The world had turned into a messy blur, and I had been caught in the middle of it.
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The world had turned into a messy blur, and I was caught in the middle of it.
Is this grammatically correct?
Or should it be instead
The world had turned into a messy blur, and I had been caught in the middle of it.
To begin with you need to understand that in this context I was caught is not perceived as a passive verb construction. Caught here is a ‘deverbal’: it has lost its verbal quality and now refers not to an action (something caught me) but to a state of ‘caught-ness’, of ‘having-been-caught’. Caught is essentially an adjective.
Perfect constructions likewise designate states. I had been caught doesn’t narrate your capture, it identifies the state (current at Reference Time, the point in time which your narrative has reached) which resulted from your capture. And that state is the same state as the one designated by the adjective caught: the state of ‘having-been-caught’.
So both expressions mean exactly the same thing. Both are grammatically acceptable. Which you employ depends on context: where you intend to take your narrative beyond this specific sentence.
If you are done with your capture and your narrative is going to move forward in the ordinary sequence, there is no reason to employ a perfect. The ‘default’ tense here is the simple past. FumbleFingers' Perfect Truism tells you “don't use Past Perfect unless you really have to”.
If however you want to back your narrative up, to flash back to the circumstances of your capture, the perfect construction permits you to do so gracefully. It provides an anchor at Reference Time which allows you to move backward in time and then reel yourself back in when you’re ready to resume your narrative.
Another situation in which you might prefer to employ the perfect is at the transition between narrative passages—the end of a chapter, for instance, where you want to sum up what has just been told in order to lay the scene for the next chapter.
This is all discussed in painful detail here, particularly in §§3 and 4.