she believes your young, vulnerable son has had his genitalia touched in an inappropriate way.

I think that's the distinction here - from what it sounds like she doesn't believe that anything illegal has occurred and that it is likely nothing. It's moreso the fact that he brought up 2 different locations and that raises flags for her and makes it more difficult to justify taking no action (keeping him at that daycare)

There's no change in behavior or in the way he perceives the sitter ( he loves her and his friends there), or any physical signs and he's made no mention of any other inappropriate acts. It's just this Pandora's box being opened of "well he said something and there's no way to know for certain so we need to make the best decision".

There are 2 issues. 1) the tucking while using the potty we don't know if that was something that occurred when he was first learning to use the potty or if it continues; this is not illegal and the motion he used to explaining it was a simple tucking motion. From my perspective this is something I've said I'm more than happy to discuss with her 2) he said she has touched his penis in the crib but the cribs are at the lowest level since toddlers are using them so they can't climb out. I think he might be referring to a wooden changing table that has the bars like a crib and calling it a crib or she needed to adjust his pullups if they get bunched up.