It's not quite that confusing: Malfoy suggests "indemnify" rather than "exonerate", and Harry refuses, and in the end it is kept "exonerate".

I'm not sure what the difference between the two means. I think in Muggle law the term "indemnify" suggests some sort of monetary compensation, while "exonerate" does not, but this doesn't quite make sense. I don't think it will be relevant to the plot, however. Just a minor detail to show us that Harry did his homework.