Type 'any Protocol' cannot conform to 'Protocol'

[ole (Ole Begemann)]

@dmitri

why does the generic function initializeLetterContainer consume the returned result of getLetterType() just fine while a similar function, initializeAndReturnLetterContainer fails to compile?

I think you're running into this limitation of SE-0352: Implicitly Opened Existentials:

When T or a T-rooted associated type appears in a non-covariant position in the result type, T cannot be bound to the underlying type of an existential value because there would be no way to represent the type-erased result. This is essentially the same property as descibed for the parameter types that prevents opening of existentials, as described above. For example:

func cannotOpen7<T: P>(_ value: T) -> X<T> { /*...*/ }

In your example, L appears in non-covariant position in the function's return type (generic parameters in Swift aren't covariant, with a few hardcoded exceptions such as Array), so this limitation applies.