I would like to note that it's people who rise back up from this sort of thing, who usually become great people.
I understand I'm reading this through the internet, but by what you wrote, it seems deep down, you know where you are lacking. I apologize if it feels like it's harsh to say, but...
Something I like to think about is that sometimes I could be part of the problem. This is because... well, when you get right down to it, the only thing I have control over is finding my weaknesses and eliminating them... or alternatively making my strengths stronger (heck, maybe even picking up new ones). If I don't put forth the effort, then maybe it wasn't so important to me as I thought... but if I really want something, I'll know when I'm busting my back for it on stuff that's not even remotely easy.
Okay, so maybe you might not be good for them now, but will you be good for them never? Can't say no to that - as long as you keep improving yourself. Okay, so maybe you're competing against a bunch of people for the same thing. Can't do anything about that but become the best person you can be. They might agree, they might not... you can't command their thoughts, but you can command yourself.
Also, you got your goals defined, but maybe you can pinpoint why you want that goal. Who knows, there might be more than one way to attain it. I mean, there might not be, but then again, there could.
Situationally, the other piece of advice I can give you is that transfers can be a back-door in, but only if you can show them you're ready for anything they can throw at you. Show them they're wrong and make them admit it. ^^;
Well, hope that encouragement came out the way it was supposed to. ^^;;