Just because the witness was "highly ranked" shows nothing.
There were at least 8 witnesses in the story, including O'Sensei himself. While the shihan admitted that he was unsure about what had occured at the demonstration, he did not say he was unclear about what O'Sensei said about the event.
Those that wish to discredit not only O'Sensei, along with an aikido shihan without reason are on very thin ice. I myself like to keep my feet on good old terra firma.