It's not his rank that surprises me, so much as it is his other obviously disqualifying characteristics that should have prevented him from getting a security clearance. As you pointed out, his dual-citizenship status is suspect (although not necessarily disqualifying), but his clearly open homosexuality is HIGHLY disturbing. This should have been caught as well as the comments he allegedly made on very public social networking sites.
Beyond Manning, there needs to be SEVERAL people relieved of command.
Back to his rank - while he wasn't the classifier of intelligence, he did work as the "grounds keeper" of intelligence data. Put another way, he was the clerical and technical help that actually performed maintenance on the secured databases.
The F22 is the most advanced weapons platform ever created, but we've got E-2 and E-3s "working under its hood", such is the practical reality of the military.
Unfortunately, the truth is much worse.