Dear M.,
Yes, children do lie and exaggerate, but in this case, I think that you need to just quietly ask that your son be transfered to another class. If they say no, then go to the School Superintendent - an office visit, not to a School Board meeting. You don't need to be intimidated, just ask that he be in another class.
If necessary, just keep him out of school for the rest of the school year, and ask that he repeat first grade - in another teacher's class. If there is no other first grade teacher, then you walk him to school and home each day for the rest of this school year. Give him a lot of love and understanding, and be very close to him - get him through this year. ...and don't talk about all this stuff, just be calm. That will help him more than anything.
If he cannot repeat first grade, then make sure that you stay in close touch with him and the second grade teacher. Don't go over the bad stuff - just go forward. He needs support and peace. I can tell that he is scared and doesn't know what to do.
Bad things sometimes do happen and we have to teach our children how to get through them with dignity.
You don't need to go over all the stuff that has been said and done. It is over and needs to stop, that is all that you need to say. Your son probably did throw a book, and so what? He is a child that has been harrassed, it seems to me. I was a teacher too, and those things that she says that he does wrong are really silly. Don't let you son be in the middle of this thing. Just quietly, as I said, get him out of there. It is so close to the end of the year, they probably will say no.
Sorry that I don't have any better solution. C. N.