I think that the the usefulness of the tag in general is good, but the name should be something other than "Manual revert". It isnt checking that steps were taken to revert edits, just that the edit is exactly the same as a previous version. There have been cases of "false" uses of this tag such as en:Special:Diff/971020476 in which I didn't even know the previous edit was adding this tag, I was just going into the page and removing it. So this edit shouldn't have been a manual revert as I had no idea it was even a direct revert of the previous edit. There should be a new name which clarifies that its the same as a previous version, but doesnt use the word "revert" (hard to come up with one short enough). However, a new revert tag, which, checks that edits are being reverted via the old id method, would be useful. Also, why does it 'time out' after some revisions? Surely with page hashing it would be feasible to check all of them.
Hope this feedback is helpful to you. Not trying to be destructive of efforts but improve mw :)