illegal weapon? if I had been asked that specific question then the answer would be "absolutely not".
imho a knife is not a weapon unless it is used or at least intended to be used that way. I have not used a knife as a weapon to date so it doesn't fit my definition when I carry one.. maybe a situation that will redefine a knifes role will come along but no bs, my knives are just tools and not "illegal weapons" to me. if he asked if I had any awesome tools on me then maybe would get a different answer. but yuh, good luck explaining all that to a judge right...
if it was me I would make a couple phone calls. first just to locate the knife and make sure it wasn't "confiscated" into somebodies personal collection. i wouldnt say all that though. just that you wanted to locate the knife that was confiscated by officer_ on _. second I would request that the knife be returned and the misunderstanding be considered a lesson learned. the last thing you can try is to have a officer buddy call for you and request the knife be returned.
if $60 bucks is worth a few phone calls to you then i'd say put $60 worth of effort into getting the knife back.