Ahh, the Good Old Boston Heresy Case hey? Well, I hope you have better luck that Fr. Feeney did.
At any rate, Baptism did not become part of the new law, necessary for salvation till sometime after the Crucifiction just before the Ascension. Which is why the Holy Innocents are in Heaven without Baptism - they were killed when Jesus was still a baby Himself and had not yet instituted Baptism - same goes for St. Dismas, the Good Thief.
A Pagan would not have been saved if he died regardless of old or new law. For those who were "Just souls" in "far away lands" who died between the old law and the promulgation of the new law, may have had one of two things happen: 1) God sent someone to baptise them before they died or 2) They did not die until the "news" reached them, at which time they were Baptised.
Of course, we could assume that He allowed salvation to those who had not been baptised because they had no way of knowing, but if we assume that to be the case, then we can also assume that 3)He allowed provisos and did mean what He said, 4)It was impossible or inconvenient for Him to send someone to Baptize just souls in far away lands.
Items one and two would be examples of God's mercy and Divine Providence, items three and four would be examples of God's........laziness?
Effectively what we are saying is that salvation is through our Lord Jesus Christ, and the kingdom He established on earth: the Catholic Church. Submission to his revelation and his appointed vicar as perpetuated from the time of the apostles is His chosen way to salvation. Assuming there is another way is an expression of our pride.
Now, the trouble in talking about "difficult cases" is that it is extremely easy to detract from the above. The liberals have said - here is a hard case, and here is another, and eventually we end up with Rahner's "The Anonymous Christian" where everyone belongs to the Church unless he curses it explicitly.
Having said that, you said:
A Pagan would not have been saved if he died regardless of old or new law. For those who were "Just souls" in "far away lands" who died between the old law and the promulgation of the new law, may have had one of two things happen: 1) God sent someone to baptise them before they died or 2) They did not die until the "news" reached them, at which time they were Baptised.
So, a pagan can be saved through baptism - in the new law. However, in the old law baptism obviously did not exist. Does that mean that all those outside the old covenant before the promulgation of the new law (e.g. from Pentecost onwards) automatically were not saved? Or is this were the argument where "limbo" comes in - a place of natural happiness for the just?