Classic visual in an IFR environment. The fighter is used to operating visually and probably felt comfortable that the collision risk was minimal, the airliner used to IFR felt very differently. The min sep for the fighter would have been 1000' head sector and 500' stern all axis which is not very compatible with 5nm and 1000' vertically.
Not right but just the way it is. It takes the mil to start flying heavies before they realise how vulnerable you can feel. Another example is clipping zones hitting low level.