Don't include it in your resume but, volunteer the information during the first interview. Put a positive spin to it - "made mistakes, learned from it and here is how I am now better off".
I disagree with him. Unless you morally feel you have to disclose it (understandable) unless it is brought up or relevant (security clearances etc), then id leave it: it simply isn't something a lot of places care about at all, and won't affect your work, so it won't be an issue. That's my two cents.
Watch the documents you sign, like always, but particularly look for something like "employee will maintain eligibility to get a security clearance."