STV is billed as a comedy, but there's a lot more going on:
One thing that bothers Bro and I in particular on multiple viewings is the manner in which Vir's underground was ultimately revealed. Why did Ivanova and Sheridan storm into Londo's quarters without discussing the matter with Vir first?
There's an implication here that is interesting- that Ivanova, Sheridan, et. al. may like Vir well enough at this point (there's a distinct note of fondness in Sheridan's voice when he recounts the fight with the Narn to Ivanova), but they don't really trust him. That perhaps, on a subconscious level, they believe Vir is more lackey than independent mind- that he is incapable of standing up to his superior.
Bro also suggested that their might be slight racism involved- "The Centauri are untrustworthy." That is an opinion based on fact, but it's relatively easy to overgeneralize without true malicious intent.
(Though the non-Human or Minbari members of the future ISA, if Legions of Fire is any indication, do slide into overt racism in several instances- objecting to Vir's presence at Sheridan's tour of Downbelow in the first book is a particularly blatant example that jumps to mind as I write this. Poor Vir- I felt so bad for him when I read that.)
Of course, all of the above is understandable when you consider that the characters in question haven't really interacted with Vir on more than a professional level. We in the audience have a privileged perspective that is opened for the first time for Sheridan and Ivanova in this episode (G'Kar gets a glance as well in Comes the Inquisitor, but he wasn't particularly inclined to listen for obvious and justifiable reasons). The lack of an acknowledgement of this fact, I believe, is the key flaw in this episode. What's needed here is an additional scene in which Sheridan and Ivanova flagellate themselves a bit for jumping to conclusions and perhaps apologize to Vir for blowing his cover so recklessly.