Some thoughts...
Both legs of your manifold should have clean-out stacks, not just the right as one shown in the first picture. Maybe the left one filled up with muck and put more pressure on the remaining slits. Were any portion of the pipes clogged? I'm guessing no, since you didn't mention that.
Not that there are any specific rules, but I spaced my slits 1-1/2" apart and cut 1/3 through the pipe. Just throwing that out there, I'm no expert, but maybe more slits are better?
As far as the blow-out...that's very strange...the walls of schedule 40 are pretty darn thick.
Maybe the pipe was defective and the wall was thin in that area.
Not trying to blame, just trying to get to the root of the problem...
It almost looks melted. Maybe when you cut the slits there was a lot of heat generated? What did you cut with? Could the blade have been dull? That might create a lot of heat.
Maybe that particular slit was cut too deep and weakened the pipe?
Do they make schedule 80 in smaller sizes? I've seen it in big sizes. If they do, maybe that's the answer.
Hope you get it all worked out and it's good you posted the problem. This discussion will help future bog builds.