Manchester still has plenty of capacity available, and I can't admit to having read their masterplan, but can imagine that the airport authority and government understand that there must be expansion to coincide not only with the Olympics like you mention but also the fairly big number of passengers the country can expect in 2012 for the Olympics.
However, it's important to consider a couple of things. There is still capacity at airports which might be considered in the region, ie where pax using MAN currently fly from. These not only include "north-westerly" airports like BLK and LPL, but also airports within a 90-minute drive such as EMA & LBA. Also, air travel on some routes will diminish freeing up slots. Improved train links from Manchester to London and Scotland for example, won't mean an end to these routes, but maybe a contraction of capacity as more people use rail.