Cindy has known, for a long time, that Caylee is deceased. She knew this was a statement that she could make in open court that could not perjure her, because it was stated as an opinion. She has been heavily coached.
She is still all about getting Casey off on the murder charges and keeping up appearances, IMO. She knew what questions she had to answer truthfully, according to past depositions/police interviews. She is concerned about herself and future criminal charges. But, if she can lie (on the stand) and get away with it, she will (ie; I believe Caylee is alive, I don't remember, I respect Casey, etc...).
If she really believed Caylee was alive she would have been searching for her, not trying to frame everyone who had contact with Casey, not providing a huge memorial service for a deceased child, not protesting the release of the autopsy report and not accepting and cremating the remains of a child she reports (now) to not even know.
The letter she wrote to Casey, about the live Caylee tip, was just more BS meant for public consumption. What kind of "loving" mother would write her daughter (if she really believed this daughter was innocent) about unverified "tips" stating her child has been seen alive (long after this daughter has been told of her childs death). The answer, IMO, is a mother who knows her daughter is not innocent and a mother who knows her Grandchild is not alive. MOO.