After Kitty describes Walter's polite and standoffish behavior in Chapter 20, why does Charlie become so confident and happy?

Charlie becomes confident and happy after hearing about Walter's mild, aloof manner towards Kitty after discovering their affair because he supposes that Walter is going to look the other way and ignore their relationship. This is the most convenient response for Charlie, as now he does not have to fear a scandal and he can continue his affair with Kitty without repercussions.