And he lets Jesse live? I guess it seems a bit far fetched. Maybe he thinks Jesse would never harm his family.
Jesse gave up running away from slavery due to a little boy that is not his blood and he only knew for some months. Jesse completely turned back to face the shit hit the fan because he found out a little boy was poisoned by Walter. Jesse was very distraught after Todd killed the kid on the bike. Walter knew Jesse would never harm kids (and possibly women) and Walt had two of them. Jesse had a great heart and genuinely felt guilty and bad about things he did, unlike Walt, Todd, Mike, Gus, Lydia, etc
I actually think Walt was going to kill Jesse too when Skinny Pete and Badger told him he was alive. Walt felt very betrayed by Jesse and he never thought Jesse would go to the police. He probably felt some type of anger towards Jesse because of Hank's death as well. However, once he saw that Jesse was a broken, chained, beaten, shell of his former self slave like a caged animal, he saved him. Had the nazis really partnered with Jesse, like Walt implied, he would have just jumped on the floor and hit that button.
Theres still no evidence that walt thought jesse was a compliant partner in the nazi meth scheme.
He may have wanted to kill jesse when he entered the compound, but that was because of jesses prior role in walts demise.
Also remember that walt was saying things to get jack to react a certain way.
I believe Walt definitely thought they were partners and not Jesse a slave to them. I think when he went there he wanted to kill all of them, nazis + Jesse. After seeing Jesse is when he realized what he did to Jesse and saved him.
I do agree that Walt knew Jack was arrogant and proud. Being called a liar would offend him greatly. Offending Jack would get him worked up and it did; Jack was pacing back and forth in the room after the little altercation. However, Jack would have gotten pissed regardless, but he really got heated when Walt called him a liar and said they were partners. In Jack's mind, Jesse was just a dog that was there to do what he wanted. However, Walter had no way to know that Jack had enslaved Jesse, for all he knew they really were partners.