This is quite clearly an oxymoron. Let us remember that an oxymoron are two words that are placed next to each other to highlight an apparent contradiction in terms, such as bittersweet or describing somebody as a wise fool. This of course reveals a deeper truth by using apparently two contradictory terms or words to describe the character, object or situation. In this quote, the narrator is making a very interesting comment about the way in which, in spite of the apparent harmony in which the boys dwelt in their idyllic setting at the highbrow school they attended, underneath the veneer of this peaceful setting there was conflict that marked the relationships. This of course foreshadows the intense conflict that the narrator feels he has with Finny that leads him to commit one action that will have far reaching consequences.