I agree with you whole-heartedly. At first I thought the question referred to the social setting of the novel, our students studies Sac de Billes, but I also am aware of the other more French meaning of 'milieu social' as social background, or as we would say 'class'. I think the question was totally unfair and amibiguous. Our students I know referred to the Jewish situation within occupied France and I hope that the examiners will mark favourably on the quality of the writing and the structure of the essay. A very unfortunate first question on this paper from Edexcel.