......If there is condensation on the inside of the camera: can it be removed?
It likely can but if it comes back, there could be more issues. I made a verbose,
earlier post regarding condensation inside a cam; maybe it will help you solve the issue. Towards the end of my post, there's suggestions on how to dry the moisture and replace/dry out the desiccant pack(s) inside the cam.
So you don't have to wade through the part that doesn't apply here, here's an excerpt that may help you:
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"I think the best we can do to fix an affected camera and mitigate the situation to help prevent (but not guarantee) future moisture intrusion is as follows:
Wait until the ambient relative humidity is at its lowest point. Choose the driest environment you can for this procedure; in other words, the bathroom after someone took a hot, steamy shower or the kitchen after or during the stove has cooked or boiled anything is NOT a good place. This will be the biggest challenge but is likely the best way to not trap moisture-laden air inside the cam when re-assembling. Late afternoon, outdoors, sunny, no rain for 24 hours and out of direct sun may be your best bet.
Open up the cam, noting how it is assembled and what gaskets and sealant rings are in place then dry it out. Soak up excess moisture with lint-free cotton rag, handkerchief, etc. Use a small hair dryer on low to accelerate the drying out of the cam's interior but don't overheat any of the components.
Allow the cam to cool down to room temp.
Replace the bag of
desiccant with a new, dry one. If you have no new bags, take the existing one, dry with hair dryer then bury in cup of uncooked, instant rice for several hours to absorb moisture from the bag.
Reassemble the cam (DON'T FORGET THE BAG OF DESICCANT), insuring OEM gaskets and sealant rings are in place. Insure that the pigtail cable entrance is sealed. If any gaskets or sealant rings are missing or damaged or the cable entrance is not sealed, you'll be wasting your time and moisture will be back in sooner than later. You should use clear, outdoor-rated silicone sealant to caulk the mating surfaces before AND after re-assembly, including the pigtail cable entrance. Allow to dry overnight before placing back into service."
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Would it cause permanent damage?
Usually gravity pulls the condensation down to the low point which is usually the lens, they combine into larger drops and even then there's only enough to produce an optical issue.
If the moisture is extreme and enough collects to affect circuit board(s) and connectors then, yes, it could possibly damage the cam permanently. The longer you wait to try and mitigate the greater the likelihood that corrosion can also occur.
