I thought he flipped a manhole cover over, not sliced through it...
That's what I thought too, I mean trying to cut the thing would be unintelligent for a variety of reasons, actually
succeeding with your tail blade would be just plain weird.
I also thought it might be the speed with which they're moving, I mean something described as moving so fast the human eye either doesn't see it or at least sees just a blur, is going to be pretty deadly.
Besides that I think there's a certain technique to it, I don't think the blades are just that awesome on their own, I believe, like martial arts allowing someone to break bricks with their bare hands, Andalites using their tail need to have a certain technique, the fact that Tobias gets his tail blade stuck during a practice session with Ax kind of supports this, but it might just have been for comic relief.
Given what we've seen of the Andalite military though it wouldn't surprise me if tail fighting is a form of Andalite martial arts rather than a purely instinctual defense mechanism.
But no matter the explanation I'm with those who say that cutting through metal is pretty freaking implausible.