Withholding information is not dishonest. Withholding information is not lying. ALL of us withhold information for a variety of reasons in a variety of circumstances.
None of the people who are criticizing the OP for being dishonest know what it is like being in the service/repair business. There are some people that just can't be made happy no matter what you do for them. I call them two-percenters. Everyone knows somebody who is like this. In the service business, after awhile you begin to recognise these unreasonable individuals after beating your head against the wall a few times and getting nowhere with them. At some point all of us get tired of these customers and try NOT to do business with them. In other words, we don't want their business and we are happy when we are able to "run them off". Life is too short to allow these individuals to ruin your day. Anyone here ever get an outrageous estimate for a repair (any kind of repair, auto, home, appliance, etc)? Maybe YOU are one of the individuals who can never be made happy. This is a way for businesses to NOT do business with you, they are charging you an aggravation fee.
I agree 100%. Withholding information was smart in this case, there was zero upside coming clean. What was bad was having stupid help. With regard to the customer, she probably felt she was "entitled" to more than her asking price when she found out what happened. The truth of the matter imo is she was "entitled" to nothing more than what she got, she got her asking price. After the fact she wanted more because of a mistake. Oh well, such is life. The only bad thing here is the bigmouth employee cost the OP a customer, and himself a job. Maybe at his next job he'll let the boss do the talking and do what he was hired to do, and keep his mouth shut.
Mistakes are made everyday, and corrected w/o a customer ever knowing, it happens. The correction here was to buy the car. If the car wasn't for sale it would be a different story, but that wasn't the case. The OP was smart and able to think on the fly.