There are two bars. One green and one red. The green bar is current condition. You should aim to get this as close to the top (full) as possible for race day. It takes quite a hit when a horse races but quickly recovers during rest periods (BLUE training icon). The level of this bar affects the horses performance in the race.

The RED bar can be looked on as a sort of season long condition 'fuel' level. It does not affect the horses race performance. Depending on training options it will slowly decrease during the season. It decreases at a different rate for different horses. When it gets low (or empty) the horse has usually had enough for the season (though it may be able to be slowly raised again by rest) and then you may notice the horses GREEN condition bar will reduce.

So considering the above if you play manual training it is important to watch the RED level to guage how much racing is taking out of your horse and estimate how many races the horse may take (on the current training settings) and alternate between rest and mid and intense training so that your horse can race a number of times during the season. Mid training will decrease the speed that the RED bar empties and Rest will slow it further (or slightly reverse it).

Does the green bar recover more quickly in manual traing at 'Rest', than it would using Simple Training?

Anyone watching Channel 4 racing the past couple of Saturdays would have seen a horse called The Sawyer rack up back to back wins in handicap chases over 2m 5f in soft ground, 7 days apart.

I wouldn't say this is a common occurence, but would this even be remotely possible in SO4?

depends on the horse

some thrive on regular runs, others need more rest
in my yard the 2m - 2m4f horses recover quicker than the 4m sloggers
x

my red bar has never moved in 10 seasons with all my horses