There was no confusion. Saul simply assumed this person to be male, especially after a pretty good scrap and almost getting his head blown off. As Grognaurd pointed out, it becomes obvious after Victor takes her hood off. Saul and Victor alike don't immediately make the connection that she's not likely a Maller until Victor remembers that the prison was an all male prison, then it's an 'ah-ha of course' moment. There's not really anything strange about not remembering a slight detail when all this shit happens with someone they just met. It's a credit to Victor that he remembered it at all, IMHO.