Bogo got angry he didn't break at 4-4 in the second and allowed the frustration to affect his game to lose the match. Alex had quite a few openings in the second set but didn't take any. Some of that was due to Marcos playing more offensively on the big points.
Overall it was an OK match. Alex made some inopportune errors that cost him. Marcos was motivated and relatively solid throughout.
As for the rankings, Baghdatis has been a below .500 player for essentially over a year now, so his ranking has fallen off. Bogo has been great for essentially a year, and had little to defend, so his ranking has shot up. That simple.
Bogo has a lot of challenger points to defend through the end of the season, so we'll see if he can maintain a top 50 ranking through the end of the season.