My understanding is that the United States does allow dual citizenship, however if the nation you choose to join youself to does not allow dual citizenship, the United States respects that law and your citizenship becomes void.
However in Barrys case, when he becomes an adult at the age of 18 he can go to any foreign office of the United States and swear aleigence to reclaim his citizenship. Barry/Obama could simply produce a copy of his registration for the draft, or refer to the records of the office that he preformed this duty at.
However, to travel has he is suspected to have done at the age of 19 on an Indonesian passport is an indication that he did not do this. Which could make him invalid to run as President. Strange that this would even be an issue.
In the case of Israel, you are allowed dual Citizenship, so if you happen to make Aliah, you do not loose your American Citizenship.
In the case of Indonesia, you are not allowed dual Citizenship, so he would have to fufill the requirements of the law.
And at the age of 19, I doubt that he was very aware of his illegal actions of maintaining his Indonesian citizenship with his new US citizenship.
I think that's correct- if you actively take actions to renounce your American citizenship, such as taking the citizenship of a country that does not recognize dual citizenship, then your American citizenship status may be in trouble.
I'm not sure what the Obamessiah's situation was when it came to his Indonesian citizenship. There's no indication that he actively sought the citizenship (if he ever had it). If he was an Indonesian citizen automatically through birth, then there is no issue under American law, regardless of any problems Indonesia may have with dual citizenship. My kids, for example, will be American, Canadian and Serbian citizens automatically at birth (and may qualify for Danish citizenship through my wife), all of whcih will be perfectly legal under American law.