Although this article is exceptionally bad as journalism, it does suggest a few things to me:
The bonus issue is even worse than people think - the contract calls for similar bonuses to be given next year, as well.
Geithner has probably known about the bonus plan from the day the government took control of AIG. Obama has probably known since he took office.
Recognizing how this would look to the public, Obama instructed Geithner to do something about the bonuses.
Working closely with Liddy and AIG, Geithner apparently chose instead to find ways ot justify the bonuses, or depict them as unavoidable.
There's no excuse - none - for this having been sprung on the public at the last second.