Linda will always be there for you, after all she has been in love with you since early school, and still is.
If I am ready this correctly, Linda was in love with you while you and Steph were together.
From hospital conversations, Cece and Linda have only been in town for a few weeks. Linda left after you and Steph started your relationship. From Linda's statement, it is likely that something happened between her and Matt (and based on time she has been back, it is likely it happened before she left)
me "Your friend is dropping by later on?"
ce "Yes. We moved here together a few weeks ago. We've kinda been looking for a place to stay."
ce "But she went home some days ago to fix some things there, and is on her way back now."
me "Linda???"
li "[name]???"
li "Oh my god. I haven't seen you in... forever!"
...
li "That friend from school I told you about... It's [name]."
...
li "Me and [name]... It was the best years of my life."
li "But then we moved away, and that was that."
me "School wasn't really the same after you left."
...
li "So... How have you been, [name]?"
me "Can't complain. But to be honest there's not much exciting to tell."
me "After school I just worked a whole lot. Got my own place and that's pretty much been my rotation for the last two years."
me "And you?"
li "I went on to study photography, and just finished last spring."
li "That's where I met Cece, and we've been pretty much inseparable since then."
li "Ehm... Do you speak with Matt by any chance?"
me "That douchebag from school? Not if he's the last person on earth. Why?"
li "Oh, that's good..."
me "There's something you're not telling me."
li "Doesn't matter..."
li "But how about you and that girl of yours? Stephanie. Everything fine with you guys?"
So what happened between Linda and Matt, and why is Linda worried that Matt may have told you?
If she dated him while you were with Steph, the only thing wrong with that is that Linda has bad taste (and if they were dating for a period of time, surely you would have found out).
Maybe she was depressed or upset that you were with Steph, Matt took advantage of the situation, got her drunk, they had sex, she became pregnant and that is why she left.
At the bar, Linda and Matt only say hello, and then ignore one another.
Either what happened was not important to Matt and he has forgotten, or he is not saying anything as he was trying to get into Cece's pants (as that would have been a perfect time for Matt to try and humiliate MC)