I think that's what makes Iruka admirable though. People shouldn't judge characters based on their power, but based on what they bring to the story. And as you said, he was the person who helped shape Naruto into the amazingly influential person he is, which IMO makes Iruka a rather important character. Imagine how different the story would be without him.
Ahhhh...we do have some intelligent people on these threads. (not being sarcastic) I'm serious tho. That's the kind of outlook I see Iruka in. I completely agree that. Just when Naruto thought he had no one in his corner, Iruka comes out and shows the boy some love. Even all the way to Part 2 (Jiraiya's end) he still played that father/big brother role.