No, Danzo was not working with Orochimaru at that time. I made a thread about their relationship not too long ago.
Hmm... I just looked over it. But it was Part 2... stuff could have changed in 3 years. Even the 'I didn't know you were still alive' comment doesn't erase all doubt. Although I'd definitely agree that Danzo would not be working with Orochimaru to destroy Konoha.
In support of the Danzo/Orochimaru together during the chunin exams theory...
I suppose I would think of it in terms of a mutually beneficial relationship; i.e., Orochimaru getting rid of the Third so Danzo could step up as Hokage and 'fix things' or whatever. If that were the case, I don't think the partnership would last and Danzo would probably have planned on turning on Orochimaru as soon as he was made Hokage (and vice versa).
Against it, though... I don't really think Danzo would have plotted against the Third. The Third seems to either let Danzo do what he wants, or Danzo just goes behind his back and does it anyway with no repercussions, so I'm not sure how much of an incentive there would really be to do so.
As far as Kishi not having thought up Danzo yet: retcon.