Wow. I am glad I decided to read every entry in this fest, or I might have missed this truly wonderful story, not being fond of either Peter or Dung, and that would have been a real crime.
This really reads as if it could be canon. We never get to know what estranged Peter from his friends and caused him to betray them, but I feel like the seeds are being laid here; not because Dung does anything which causes him to turn, but because we see him acting as his own agent, being assertive with the other Marauders and keeping secrets from them for the first time.
I always felt that the others never really viewed him as an equal, but as someone they took on reluctantly, perhaps because they felt obliged to because he roomed with them, and you showed that beautifully here. I don't think it was possible for them to be much more condescending, and the idea that Mundungus sees something in Peter that the others don't isn't so far-fetched. I appreciate the interplay between them and that the gavotte of mutual interest and desire doesn't lead to earth-shattering sex - just a lovely and tender first kiss. A real gem, this is, Mystery Author, and you've made a new fan. If I don't know you, all be hunting down all of the rest of your stories. :-)