I think they'll make it back after finding the balloon because if they don't then Jack and Locke won't think he's telling the truth. A trade for Michael sounds more plausible. I'm 100% sure Henry is lying and I don't understand how anyone else can think he's innocent, let alone be not 100% sure. His creepy smirks and manipulative conversation. Not to mention that Henry Gale Minnesota is an anagram for "See An Other Man Lying" or something to that effect. And the whole Wizard of Oz connection. I think the writers are just trying to show us that he's clearly bad so we watch the survivors listen to him and not be sure while we yell "Don't listen to him" the same way people watch a horror movie and know the killer is behind that door. Don't open that door, but they do and end up screwed.