Yes, it will allow me to reply, but at no stage does it tell me what comment he/she has made, so I can reply appropriately, if that makes sense?
The comment is just a pingback, so the content of the comment is what you see surrounded by [...].
The user linked to one of your posts in their post, and an excerpt surrounding the link in their post was provided as a comment. You can reply to that via the Notifications menu, but it would be best to visit their post and comment there.
It also doesn't explain why I can't see or reply to members via the orange notification thing up top, either - the same thing is occurring there; I can see their blog/user name, but not what they've typed, so it must seem to them as though I'm ignoring them
That's because they are Likes, they are not comments. The only comment in your notification menu is the pingback on "How to Escape Cults. . . "