From the limited reporting on today's events, it now appears that the government acknowledges the daughter was on the no-fly list. Most of the hearing was closed to the public, but it appears that it was solely because of her association with this lawsuit.
There wasn't any reporting on how the government's lawyers explained their previous firm assertion that she was not on the no-fly list and they had nothing to do with the witness being unable to travel to testify.
It's a difficult situation. The usual result is "It goes to their credibility", meaning 'they are liars'. The sanction is that the other side is given the benefit of the doubt when there is a dispute about facts. But you can't apply that conclusion to the whole US government. Especially when the conclusion affects The People as a whole, not the bad actors that mislead the court. Which means there is no effective sanction to an outright lie in court made by a government attorney.
I'm still hoping for a later hearing on witness tampering. Not much would come of it, but it's at least a modest penalty to put the people involved on the stand and have them sweat a bit (even if it's effectively an all-expenses-paid break from work).