Despite only playing Jr A he was considered a definite top 3 prospect in 2007, it was somewhat of a toss up between Kane, JVR and Turris for the top 3 picks, once Kane and JVR went 1 and 2 I think everyone knew Turris would go 3rd, regardless of who was making the pick. Obviously there was some risk with him playing only playing Jr A and being a skinny kid, but it's not like he was a reach. He did play great at the Super Series and the WJCs, but I'm pretty sure that was all post-draft, so not part of where he was drafted.
Regardless, he's still young, seemed to show progress late in the playoffs, and it's not like he was drafted immediately in front of superstars, the next 5 picks were Thomas Hickey, Karl Alzner, Sam Gagner, Jakub Voracek and Zach Hamill. He could still pan out, I don't consider him a bust yet. Not everyone develops at the same rate, look at some of the top players who made it deep in last years playoffs (the Sedins, Tim Thomas, Martin St. Louis), all took quite a while to make an impact in the NHL.