Is it normal for a drying lemon cypress tree to still smells lemon?


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If it is warm enough put the plant back outside in filtered sunlight and wait it out.
Your plant has been through plenty of stressors in it's short life so far with you. Yet it still continues to persevere, so it must have good genes, ha. I have no experience with this variety of tree, so cannot offer horticultural advice, but I would try to be gentle with it and make no drastic changes to it's environment. I see that you live in a desert locale. It may be too hot for it outside this summer. If you do put it outside, place it where it will have shade most of the time and be protected from the strong winds which occur in the desert. A tool that I have found helpful is a plant moisture meter which is a metal rod with an indicator/meter on top, which tells you when it need water when you poke the rod into the soil. You may find one at Walmart or your nursery.
Cut off the brown.brittle stuff. Looks like the tree is reviving itself. If it still smells like lemon it is still alive.