It's interesting how you bring up lying. I used to work with kids doing birthday parties and it was my job to lie to children and convince them that I was The Little Mermaid and play and paint their faces. The joy it brought them was amazing.

Keep it mind that up until a certain age the world is full of wonder and imagination and innocence and it should be. Children learn to interact and communicate and have and deal emotions first, before they start to learn in a more factual sense.

At some point - around 7 or 8 or 9 - kids should be told a bit more of the truth and start learning and understanding how things work, that life isn't fair, the difference between facts and lies, etc. But at two or three or five years old, things like this stimulate them and make them curious and help them learn and explore in a different way. I would argue that your experience learning about truth vs lies vs half-truths is what made you intelligent and analytical today. You wouldn't have that same sort of personality or passion if it weren't for that.

That said, each child is different and as a parent or teacher or whatever you have to adapt to constantly challenge and teach children. Some children learn best through painting or imagination experiences or fictional books. They take these stories and experiences and grow from them and develop from them. You would have probably been better challenged reading non-fiction books or "how stuff works" books or science experiments.