He was cryptic about it, but he didn't outright lie.
...And that was with an obvious intent of maintaining tight secrecy about his true nature.
Interestingly, once again our heroes are expected to host a famous diplomat whose most fundamental specs are kept secret from them. Nobody told Picard that Riva was deaf; nobody told Picard that Sarek was senile; nobody told Picard that Odan was a parasite, or that Alkar was a mind-rapist. Moreover, the implication is that somebody took great care that this information would not have been available to Picard even if he had the prescience to look for it.
This makes perfect sense: diplomats are people with dirty secrets by profession, but OTOH diplomats need to appear squeaky-clean by profession. The degree to which their lives are shrouded in official lies probably depends on their general luminosity: celebrities enjoy greater UFP obfuscation services than the rank and file.
The notion of whoever from Starfleet/the Feds who made first contact, and those who subsequently negotiated Trill's entry into the Federation being deceptive about such an important aspect of Trill society seems even more far-fetched.
How so? The Federation wants new members and alliances - but strangers are always a threat, what with their strange and perverse ways. To sell the concept of alliance to the home front, the contact people always have to lie to smooth the edges. And we know this works in cases other than Trill: Vulcans remain an enigma to the average (and above-average) Fed, the people of Ardana disgust the visiting heroes... Indeed, basically every UFP location our heroes ever visit, be it a homeworld, colony or research outpost, harbors a secret that catches the heroes by surprise even if it really is no secret to the locals.