Korsgaard's basic idea is that so long as the murderer doesn't realize that you know him to be a murderer, then lying to (people you believe to be) inquiring murderers will still be efficacious, even if universally practiced. You can publicly abide by the maxim of lying to (believed) murderers, and this murderer will still believe you -- since he assumes that you take him to be an ordinary person, to whom you wouldn't lie.
So that helps avoid absurdity in one kind of case, at least. What about transparently inquiring murderers (like the inquiring Nazi)? Korsgaard writes (p.330, fn.4):
On the other hand, suppose that the murderer does, contrary to my supposition, announce his real intentions. Then the arguments that I have given do not apply. In this case, I believe your only recourse is refusal to answer (whether or not the victim is in your house, or you know his whereabouts).
But this is just obviously inadequate in the Inquiring Nazi case. If you refuse to answer his inquiry, he will (we may suppose) storm inside and check things out for himself. You're effectively signing the hidden Jew's death warrant. Surely this is no less disqualifying than Kant's original lunacy.
Korsgaard, C. (1986) 'The Right to Lie: Kant on Dealing with Evil' Philosophy and Public Affairs 15 (4):325-349.