I don't know enough to say who knew how much and when, although recent accounts (such as the new Frontline 'Bush's War') seem to indicate that prisoner abuses were the result of a deliberate and high-level redefinition of 'torture' carried out amid a pervasive government-wide feeling that 'the gloves should come off'.
On the question of waterboarding, it is absolutely and unmistakably a form of torture, period. Malcolm Nance has an informative piece over at Small Wars Journal on this subject:
http://smallwarsjournal.com/blog/200...torture-perio/
Nance should know, as he has conducted waterboardings himself.
The common mantra of waterboarding as a 'simulation' is vastly misleading. It is not a simulated drowning but a controlled drowning.