yeah i guess i'll write down what i have understood of this situation from your post and other's comments, just to make sense of things for me. To make my bias clear, i hated my parents, so i won't be kind to you, but will try to be as fair as i can.
as someone pointed out, it is strange that the step-daughter needed to cook up such a big lie to hide her being sexually active. it raises questions about the family dynamics you guys have, is sex such a big no-no? or is this an issue with the girl, where she went overboard? Also not posting bail seems like the biggest breach of trust you did. Again it is unclear how/why you were willing to damn your son to such a degree, essentially you pronounced him guilty without a trial. This makes me believe either you have trust issues, (You wanted to believe your son guilty), or your step-daughter has big psychological issues if she could make up a story so convincing.
I wouldn't want to brand a 16 year old a psychopath, OP hasn't given enough details about issues above. She needs counselling for sure.
What you describe are a series of knee-jerk reactions, again something another thoughtful comment has touched on. First give up on your son, and now give up on your step-daughter. It is almost as if you describe them as someone else's children and all your actions were taken believing stories at face-value. If your daughter simply goes to live with her dad, and doesn't get counselling that hasn't really solved anything, and here i am curious about your wife's feelings towards her biological daughter.
If I was your son, and i read the post i would be angry, you write everything as if you'll do anything to be forgiven. You cannot really turn back time, and it is not about a 'lost year'. Your son probably has lost all trust in you for not believing in him. To make sense of the world he has had to purge everyone who won't be there for him from his mind, and this includes you, you weren't there in his toughest hour. The destruction of his social life is the worst, now he is physically trapped with the people he probably hates most at this point, and no-one outside to vent to, though I really hope the therapist works out. In fact all our hyperbole 'Everything I have has always been for you' seem especially insincere in the light of how you dealt with the issue, though again we dont know all the missing bits of info.
From the point of view of karma, your son was alone wondering if things would ever be good again, if anyone would would believe him, now it is you who is in the darkness. I wouldn't know what happens to this story, but you will have to work it out with the therapist, the only intermediary which will talk to both parties. I wonder if your son would be ready to go back to college even if he gets his admission this time.
I really hope this is fake, i don't know why people do that, but i have seen them do it. in case it isn't, I pray for your son, and hope your desire to set things right is sincere.