Fill in the blanks to complete the sentence:

What made the palace ______, was that it glittered and ________.

Option A ("Special; magical") is incorrect because the sentence already mentions that the palace glittered, and adding "magical" would be redundant and unnecessary.

Option B ("appear; hid") is incorrect because "appear" does not fit the context of the sentence. The sentence is trying to convey that the palace was special.

Option D ("light; lit") is also incorrect because the word "light" is not used as an adjective to describe the palace. It is true that "lit" means illuminated, but it does not accurately convey the sense of glittering that is mentioned in the sentence.

Therefore, the correct answer is C, riveting; sparkled, which accurately describes the captivating effect of the palace's glittering and sparkling appearance.