[link to original on tumblr]
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I got to thinking about this, especially because the lyric accompanying that Picardy third contains "home" and I've written about the lyrical/musical connections with "home" before (with "She's Coming Home" and "Care of Cell 44").
The Picardy third and "home" together are particularly significant here, considering the subject matter in the song. The period following World War I (or even during it) was filled with disillusionment, and the ending of "Butcher's Tale" demonstrates that really well. The vocals don't go to the root note (D) almost as if they can't go home again after having witnessed the horrors of war ("a friend of mine / Hang[ing] on the wire like some rag toy"). And they don't go to the minor third (F) almost as if they don't want to emphasize the sadness that minor chords seem to signify. Instead, they go to the major third (F#). They seem to yearn for something higher - both literally (F# is higher than D) and figuratively (as if the "home" mentioned in the lyrics is a spiritual home above the old Earthly home [id est: Heaven]).