Flynn was not let go because of conversations with the Russians. It was because he lied to VP Mike Pence about it.
IMO he was let go because the intelligence community and GOPe (Pence, Priebus, Ryan, etc.) went after Flynn in part to keep Trump from dumping Priebus.
That the WH now has “full confidence” in Priebus is bunk. Either Trump and Bannon are stupid, which they aren’t, or they are now captive. Pence was the trump card that Priebus and Ryan could pull on Trump—and they pulled it.
I don’t know that he did lie. It would depend on what question was asked, and what he actually said.
It is not unusual for someone to hear something, and take it a step further. I have seen it happen in communications all the time.