It might not be the best worded email, but it's quite fair ACE have pointed this out before acting on Gary's legal request.
The point of FOI is not simply to provide information, but rather to make information public.
ACE also publicise which documents they have published under FOI.
So it's fair warning to Gary to decide if he wants to read it, or let everyone read it. If Gary receives a copy privately, then decides to publish it online himself, ACE can't then refuse to publish it, as clearly the exemption of confidentially cannot be applied (sections 41 or 43).
Hardly a "gagging clause".
If ACE are willing to provide a copy of the review to the organisation concerned, then there is no need to invoke a legal instrument and the time involved to process the request?