In large saucepan bring water to a rolling boil and add lentils. Reduce heat to simmer for approximately 45 minutes or until lentils are softened. Drain water off lentils, return to stove, add olive oil and stir. Add taco seasoning and stir together until well mixed.
Place lentil mixture in a food processor and process until smooth, approximately 15-20 seconds.
Using a 3-4 quart casserole, or similar dish or deep platter, layer remaining ingredients in order. Top with olives, tomatoes and green onion.