So Emily was blogging that she had an unhappy ending that her reader said didn't work; that it should have a happy ending. Well, it is more commercially acceptable that way, but isn't a necessity. It depends on how it is pulled off, and the reasons for it. Example:
Saving Private Ryan
Up until the end, we think that Tom Hanks has a chance of making it out alive. Then wham. He dies. But we aren't running out of the theater with "That's so lame, he should have lived." But considering in the context, that the sacrifice was not in vain, that the good guys should prevail. I'm not talking about Pvt. Ryan surviving, but on the greater context of the war.
It is not that there needs a happy ending, just the goal has to exceed the tragedy, and that there is not a way that the goal can be accomplished without tragedy. Example:
Saving Private Ryan
Sir, if the Krauts are holding this bridge when division shows up, our guys are going to be sitting ducks.
He's right, we can't shoot him...well, we could but we'd get in an enormous amount of trouble. And he's right about the bridge, it's a hell of a lot more important than he is.
The holding of the bridge was more important than any single life in the context of the war, and therefore, even if Ryan had been killed, or Miller (Hanks); if the bridge is saved then the sacrifice holds true.
In 300 Leonidas sacrifices himself and his 300 to hold against the might of the persian army.
In Armeggedon, Harry Stamper(Bruce WIllis) sacrifices himself to save his daughter's future (not to mention all of Earth).
In Alien3, Ripley drops into molten metal to prevent the corporation from getting alien DNA and preventing the Aliens from infecting all of Earth.
In Terminator 2 - Shwartzenegger as the Terminator, lowers himself into a molten vat to destroy the compenents that would lead to the development of Skynet and then the destruction of human civilization.
Another point is that some endings can be both happy and bittersweet. Example:
The Butterfly Effect
Ashton manages to save the love of his life (happy ending) but does not end up being with her (bittersweet).
Rick kills Major Strasser (happy ending), helps Victor Lazlo escape (happy ending), but lets Ilsa,the love of his life, go with Lazlo (bittersweet).
Again, the benefit of getting Lazlo out was greater than the associated loss.
Finally, if the audience sees another way that doesn't end in loss, or if the goal is not achieved, then the audience will feel offended.