I totally agree with your last point, and I wish more university acknowledged this when deciding who teaches classes. My favourite CS course was taught by a first year MS student. For most universities though, letting an undergraduate teach a class is a no-no and it surprises me that Stanford, one of the most prestigious university in the world, would make an exception to that.
Edit: Commenter above clarified to me that the student is not teaching a full blown 3 unit course.
Stanford undergrads and grads alike can teach a course as long as they have (1) the necessary background, (2) passion and proficiency in the tech, and (3) motivation to teach and manage course overhead.
Being a "super genius" doesn't correlate with being informative and having intrinsic instructional value.