First, he was stating his personal theological opinion, and this was a private letter, not a public one, and hence fallible. Also Matt is wrong, the letter was written in 1206, not 1208.
Second of all, this was fully 9 years before the Fourth Lateran Council, whereby he made it a dogma that one must be of the Faithful to be saved.
Third, it had not at that time been defined that such a "baptism" was invalid.
Pope Innocent III was not a heretic, and this does nothing to prove baptism of desire, which is eliminated by more decrees than just those Matt1618 has attempted to dissect.
Building a belief in doctrines, based on fallible sources is like building a house upon the sand. No. You build your house on the ROCK of St. Peter, and what has been infallibly revealed by means of the same rock, if you expect to withstand the wind and the rain.