If Libby thought the investigation was bogus, then he should have seaid so. The indictment recites a story that paints Libby as having lied to investigators.
So, is your argument that it is okay to lie to investigators? I'm not sure there is entrapment - not on a read of the indictment. Libby learned about Plame, the investigators asked him some questions about where he learned about Plame, and he didn't tell them the truth (so reads the allegations of the indictment). He could have just as easily said, " I called the CIA and they told me, then I spread the rumor around to a buch of dumbass reporters to see how fast the rumor would spread." No crime there.