Pedantically, Bush may have actually been correct: the levees failed by collapsing under the water load, whereas the concern was entirely on failing by being overtopped. In colloquial terms, people will use the term "breach" to refer to both failure modes, but these failure modes are actually quite different, and apparently the Army Corps of Engineers reserved "breach" to mean only the first one.

On the other hand, I'm not really willing to give Bush much credit here. The middle of a disaster is not the right time for pedantry.