Yes. Which brings up another, semi related point. Visser 3 knew about the peace movement later. All he needed to do to root it out completely was have every yeerk swap hosts. The hosts' memories would reveal all the traitors.
But back to this, we knew the yeerks had speculated that the andalite bandits were really humans. The animorphs suspected Visser 3 was so convinced they had to be andalites that he simply wouldn't entertain the idea. Makes sense given how much he romanticized the andalites. We also know at least one and probably more knew the animorphs were human, but kept their mouths shut.
None of the narrative really makes a heckuva lotta sense if you dig at it. Like how do we know Rachel's last words, or anything that happened to the anis once they left Earth at the end of the series. It's always possible that half the information was false, to throw the yeerks off though. Assuming the books were written but not published during the war, it could just have been a control to give the animorphs enough time to escape if the books were discovered.