There's no question that the guy was lying. And to me, the real killer is Tommy Franks's statement that he was informed personally by both Mubarak and King Hussein that Saddam had told them he had chems and would use them.
Now at that point, we have no choice. Because if Saddam was telling other Arab leaders that he really had WMD's, those leaders knew that we knew that, and we then backed down, all our credibility would have been in the crapper. Our threats would have been meaningless because we would have been seen as backing down. His own lies justified our actions.