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The siding should be cut away and the ledger board must be flashed. Failing to flash the ledger board is the single biggest cause of moisture and insect damage to the house. The vinyl siding can be cut right along the ledger board. Each lap is nailed at the top so that the vinyl is suspended from slots in the nailing flange but can move side to side for expansion. After you cut the siding, press down on the cut piece and it will detach from the nailing flange below. Using a thin cats paw or pry bar, remove the nails from the upper piece of cut siding, like you would if you were repairing roof shingles. Push up on the cut piece to unlock the nailing flange and remove it.

You can get some vinyl siding starter strips from a supplier. After you have installed the ledger board and flashed, you can use a starter strip to secure the bottom of the siding lap above the deck boards.

If you have questions feel free to post, but if you ask your vinyl siding dealer about this, he will show you how the siding interlocks and explain this in a more visual way than I can here. In any event, if you can build a deck, this siding issue is definitely something you can handle. Pretty simple once you see how it works.