I'll have to say this is the first time I've heard of a catheter staying in place once deflated.
The irritation may just be normal, but it never hurts to ask the doctor's office. When I had that, it turned out to be a UTI. Did they do a urine sample to culture? That is a normal part of the uro visit for me now. If it is external irritation, an OTC hydrocortisone cream might help. One thing to remember is still to keep it clean.
My uro also had me drink cranberry or cranberry-mix 100% juices - helps keep infections down. For me it has taken the place of my daily orange juice - that had to go to help the incontinence.
He will have some debris in the urine for quite a while as the urethra sutures heal.
Good to hear Good News!