You're mistaken; the vowel is short, both phonologically and phonetically. It is the /ɪ/ vowel found in words such as lit, sit, kit. I don't know what voice you're referring to; if you mean the recorded pronunciations on the Cambridge dictionary site, you've misheard the vowel. They do both use the /ɪ/ phoneme.
The vowel being weakened does not mean it would not be pronounced with r-coloring/retroflexion in American English. If anything, the reverse is probably true: "weakened" or reduced vowel are more likely to assimilate to adjacent sounds. In fact, some analyses treat a schwa followed by "r" as a syllabic consonant /r̩/ with no vowel at all.
It's true that the first schwa is likely to be dropped in UK English, resulting in a pronunciation with three syllables, /lɪtrəli/. This seems to be due to the stress pattern of the word, but it's complicated to explain the exact conditions and I'm not sure I can do it. If you're really interested in learning this, there's a post I made on ELU that has some information I found that might be helpful from "Optimality Theory and Prosody", by Michael Hammond. An example word he gives that shows the same pattern of schwa loss is respiratory > resp'ratory.
The third vowel is a schwa, and therefore I would say it is a "weak" or reduced vowel. It just isn't dropped, probably for stress-related reasons as I said above.