Or to be more specific, it's the beginning of a "loose"/floating (this is James Bond after-all) continuity that continuing on through the Roger Moore and Timothy Dalton eras (which both mention the fact that he was once married and his wife tragically died).
This could probably explain why Blofeld and Bond in OMHSS don't seem to know each other despite previously facing off in You Only Live Twice.
There's a theory that DAF just picks up from YOLT and pretends that the events in OHMSS didn't happen. It explains why Bond is still in Japan, why Moneypenny is still fluttering her eyelashes at him, why M says Blofeld is dead, though we know he was alive at the end of OHMSS and why Bond doesn't kill Blofeld on sight
I've never bought that theory. It seems to me that showing Bond in a very angry rage in the teaser is the mark of a man seeking Blofeld on a vendetta. It's meant to be a subtle acknowledgment. Also, M's remark is meant to imply that Blofeld is dead as a result of the *teaser*. And his remark about "the least we can expect from you is some work" now always struck me as a hidden way of saying, "We allowed you to go after Blofeld on your own because of the personal issue but now that he's dead, get back to work!"
I take your point about Ms remark. I'm still not comfortable with Moneypenny's remark to a man recently and tragically widowed or why Bond sits calmly chatting to his wife's murderer, not once mentioning it.