nor the fact that

Question

The original senences:

Marshal Soult was reputed to be the man behind the scheme both for removing and using the unemployed foreign ex-soldiers. He could not have failed to recognize, once they were formed into disciplined units, how useful they would be, both for garrison duty and for active operations in Algeria, nor the fact that if their casualties were heavy or their conditions not of the best, there would be no embarrassing reaction for agitation in France on their behalf.

Do they mean?

Marshal Soult was reputed to be the man behind the scheme both for removing and using the unemployed foreign ex-soldiers. He could not have failed to recognize, once they were formed into disciplined units, how useful they would be, both for garrison duty and for active operations in Algeria, nor [could he have failed to recognize] the fact that if their casualties were heavy or their conditions not of the best, there would be no embarrassing reaction for agitation in France on their behalf.

Answer 1

Yes, that is what is meant.

The original phrasing would be confusing for anyone, since it does not specify early on that a conjunction would be made between the two phrases, the first of which is rather long and both having a conjunction of their own. It is not grammatically incorrect, however readers may be forced to read a second time to understand.

• He could not have failed to recognize,
• • once they were formed into disciplined units, how useful they would be, both
• • • for garrison duty
• • and
• • • for active operations in Algeria,
• nor
• • the fact that if [either]
• • • their casualties were heavy
• • or
• • • their conditions not of the best,
• • there would be no embarrassing reaction for agitation in France on their behalf.

In order to solve such an issue, the easiest solution would be to use "neither" rather than "not", so readers would more readily tell what the "nor" is referring to:

He could neither have failed to recognize, once they were formed into disciplined units, how useful they would be, both for garrison duty and for active operations in Algeria, nor the fact that if their casualties were heavy or their conditions not of the best, there would be no embarrassing reaction for agitation in France on their behalf.