The 55-year-old was arrested at a campsite near Moroka Road, Arbuckle Junction in the High Plains area, by special operations officers who flew to the area by helicopter.
9News understands the father of three left his Caroline Springs home in Melbourne after having a fight with his wife.
It is also understood police had not been planning to arrest Mr Lynn on Monday but decided to because they were concerned about his mental health.
No charges have been laid against Mr Lynn, but police will allege his beige car is the blue Nissan Patrol police had been searching for and later seized as part of the investigation.
Detectives will allege Mr Lynn has changed the colour of the Nissan Patrol to avoid being found by police.
Neighbour John Vella said he noticed Mr Lynn changed the colour of his Nissan Patrol about a year ago.
"It was in need of a spray paint because the paint was all faded and there were rust spots," he said.
"You don't expect that in your neighbourhood. He seemed to be very nice."
However, police have been unable to find the trailer that was believed to be attached to the vehicle at the time the campers went missing.
Neighbours today revealed their "shock" over Mr Lynn's arrest, describing him as a "family man" who seemed "very nice".
"I feel really shocked," one of his neighbours said.
"They were very nice people. Very good neighbours.
"I only talk to him a couple of times to say hello.
"He said he likes camping, going camping."
Amin Khandakar said he was shocked to hear the news about his neighbour, who seemed to be a "family person".
"He's a family person ... he's got kids," he told reporters.
Jetstar has confirmed the pilot had been stood down.
"Jetstar has been advised by Victoria Police that one of its employees is under investigation for a serious crime and will work to assist in this due process any way we can," a spokesperson said, in a statement.
"As a matter of course, the employee has been removed from duty as a result of their arrest."
Mr Lynn was arrested about 5.30pm on Sunday and remains in police custody at Sale police station in East Gippsland.
"The investigation into the matter remains ongoing," police said in a statement.
'Police have found a needle in a haystack'
The sister of Ms Clay, Jill Walker, said the arrest was the outcome she had been hoping for after 20 months of no answers.
"It was pretty amazing because after waiting for so long, to have some movement in the case was fantastic," she told Today.
"It's very early days. But at least something now's progressed."
Ms Walker said the investigation had been "warming up" but she did not expect an arrest would be made so soon.
"Hopefully, this is the breakthrough police have been working so laboriously towards," she said.
"They really have found a needle in a haystack."
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As soon as she saw the photos of the burnt-out campsite, Ms Walker said she knew "something terrible had happened".
"It was so inexplicable," she said.
"Russell knew the area like the back of his hand.
"This arrest yesterday has made it feel a little bit more real."
Ms Walker hopes in time police will be able to find their bodies, and she can lay her sister to rest.
"You are just hanging onto this tiny glimmer of hope that they're going to be OK," she said.
"You don't ever let go of that even though intellectually you know they're not coming back."
What happened to the campers?
Despite numerous searches, the pair have never been found.
Detective Inspector Andrew Stamper earlier this month said a person may have been camping nearby, with Mr Hill not camping in the best spot on-site.
Mr Hill was an experienced camper who had a connection to the Gippsland region from his work there as a logger many years ago.
Police had released images and a sketch of a dark blue Nissan Patrol they had been searching for.
The high-profile missing campers case has captured the nation, with detectives earlier describing the complex investigation as piecing together a puzzle filled with ambiguity.
Mr Hill left his Drouin home on March 19 and picked up Ms Clay from her Pakenham home in his white Toyota Landcruiser.
Ms Clay told her friends she was heading away and was expecting to return home on March 28 or 29.
The pair then travelled via Licola, spending a night camping at Howitt High Plains, before heading into the Wonnangatta Valley on March 20.
Mr Hill was last heard from on March 20 via HF radio stating he was at Wonnangatta Valley in the Victorian Alps.
The pair were camping together at Wonnangatta River near the Wonnangatta camping ground.
Mr Hill purchased a DJI Mavic drone before the trip, which is yet to be recovered.
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The pair's campsite was found destroyed by fire near Dry River Creek Track on March 21.
Mr Hill's Landcruiser had also sustained minor fire damage, prompting fears of foul play.
His daughters, Colleen and Debbie, in an emotional interview last month, said the thought of not knowing what happened to their father was like an endless loop of pain.
"It's really hard, it's not getting any better," Debbie said.
"It's just unknown. You can't grieve for someone that you don't know if they are really missing or dead, you are just stuck in the middle.
"You can't really have a funeral - you don't want to because then it's saying they've definitely died."
Debbie said she believed her father was dead, as she could not fathom him not contacting the family if he was still alive.
"If he was alive he would not not contact us," she said.
"I really don't think he could be alive. He wouldn't hide."
Ms Walker said hearing about her sister's disappearance came as a "terrible shock".
She immediately knew something was "horribly wrong" as there had been no contact from her sister, and all their possessions at the campsite had been left abandoned.
"You just have this great sinking feeling," she said.
The exact circumstances of the arrest are yet to be revealed.
https://news.google.com/__i/rss/rd/articles/CBMipgFodHRwczovL3d3dy45bmV3cy5jb20uYXUvbmF0aW9uYWwvbWFuLWFycmVzdGVkLW92ZXItbXlzdGVyaW91cy1kaXNhcHBlYXJhbmNlLW9mLW1pc3NpbmctdmljdG9yaWFuLWNhbXBlcnMtcnVzc2VsbC1oaWxsLWNhcm9sLWNsYXkvNGY0OTQyMGQtNWQwZC00MWZjLThmOGYtODI1MDg2YzZhM2Y30gFFaHR0cHM6Ly9hbXAuOW5ld3MuY29tLmF1L2FydGljbGUvNGY0OTQyMGQtNWQwZC00MWZjLThmOGYtODI1MDg2YzZhM2Y3?oc=5
2021-11-24 07:26:52Z
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