Board Thread:Series general discussion/@comment-27020644-20151010032341/@comment-98.115.119.103-20151010060348
Lineage is canon, though I can understand your confusion on this issue. The problem is that Lineage doesn't immediately continue into Assassin's Creed II. There's something of a time skip following the short film and the beginning of the game, wherein Giovanni continues his adventures offscreen in a piece of the story puzzle that we've not been privy to as of yet.
What we can extrapolate from what we are given though, is that following his departure from the Auditore home at the end of Lineage, Giovanni continued his investigation into the Templar plot he came upon in Lineage, eventually uncovering some manner of evidence of the Pazzi's involvement in the growing conspiracy. Having discovered Francesco di Pazzi's complicity, Giovanni is vindicated and his status as a citizen in good standing is seemingly restored, allowing things to return to the sense of apparent normalcy in which Assassin's Creed II begins.