From personal experience and from my vets that come see me have said is that all claims are denied the first time unless you specify exact pages in your records you want to use for evidence because they see so many claims they don't have time or want to spend the time to review every single page. If you specify for example Military Medical Records page 487 or Yakima Memorial Hospital records page 32 and why you want them to look at that page(s) you can usually get the claim pushed through quickly. And in my case since the VA is treating me for the items I'm claiming so I will not have to go down town to see another doctor.
As for the shredded stuff they should have only been their copies. You should have been given a copy of all the paperwork for your own file by them also.