"Whether or not I did it correctly, it has already been processed by the HSA brokerage firm as a return of excess 2020 contribution, and so there is no opportunity to withdraw the $66 excess contribution from 2019 + earnings as a normal distribution as you suggested."
Basically, you should not have asked the HSA custodian to withdraw that $66 as excess earnings for 2020. They would have no way to know if it was an excess for 2020 or a prior year, so they would take your word for it.
However, this is getting out in the weeds. It will not matter that the HSA custodian took your word for it; if there were ever a detailed audit of your 2019 and 2020 returns, this should be changed for both years by the IRS auditor.
Honestly, though, I have not heard of HSAs being part of an audit - they should be, but I have never heard of it. So as I said, this is way out in the weeds, so you should note what you did and stick it in your tax file and just be ready to explain in case anyone ever asks.
I can't rightly answer your other questions about what year things are taxable in, because the way you have done things has already deviated from the way it should have been done.
So, it's your choice, but since this represents not a large amount of money, I would consider just leaving the return the way it is, declaring victory, and promising to do better the next time.
Just watch your tax return, though, and make sure that TurboTax is not creating a 5329 (Part VII) to penalize a carryover - if so, you will have to do a distribution of that amount, or report that part of the current 1099-SA distribution was not for qualified medical expenses - this is the only way to get TurboTax to not keep doing this now.
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