If you draw a clear diagram like the one below, it is easy to see that there are $\boxed{\textbf{(A) }49}$ points.
[asy] size(14cm); pathpen = brown + 1.337; // Initialize octagon pair[] A; for (int i=0; i<8; ++i) { A[i] = dir(45*i); } D(CR( (0,0), 1)); // Draw diagonals // choose pen colors pen[] colors; colors[1] = orange + 1.337; colors[2] = purple; colors[3] = green; colors[4] = black; for (int d=1; d<=4; ++d) { pathpen = colors[d]; for (int j=0; j<8; ++j) { D(A[j]--A[(j+d) % 8]); } } pathpen = blue + 2; // Draw all the intersections pointpen = red + 7; for (int x1=0; x1<8; ++x1) { for (int x2=x1+1; x2<8; ++x2) { for (int x3=x2+1; x3<8; ++x3) { for (int x4=x3+1; x4<8; ++x4) { D(IP(A[x1]--A[x2], A[x3]--A[x4])); D(IP(A[x1]--A[x3], A[x4]--A[x2])); D(IP(A[x1]--A[x4], A[x2]--A[x3])); } } } }[/asy]
All $20$ diagonals are drawn in a regular octagon. At how many distinct points in the interior
of the octagon (not on the boundary) do two or more diagonals intersect?
$\textbf{(A)}\ 49\qquad\textbf{(B)}\ 65\qquad\textbf{(C)}\ 70\qquad\textbf{(D)}\ 96\qquad\textbf{(E)}\ 128$