Looking at this there's something called the Copine scale which categorises these images
http://en.wikipedia.org/wiki/COPINE_scale
143 images were level 1 which means
'Non-erotic and non-sexualised pictures showing children in their underwear, swimming costumes from either commercial sources or family albums. Pictures of children playing in normal settings, in which the context or organisation of pictures by the collector indicates inappropriateness.'
46 were at level 3 but he'd not looked at them
Now I've not read this report but at face value the description in the article 'child abuse images' seems grossly misleading.
He may have been ill-advised to accept the Police caution - If he'd declined it and gone to court he may well have been acquitted
As it stands you're right I can't see how he'd be remployed
But I don't think you can conclude he'd be a danger to kids without more details
I'd strongly suggest you look at the Copine scale link and see the descriptions of sort of material that was found before rushing to judgement