If one googles "Levada", one finds a very good article that Levada wrote in 1995 about pro-choice "Catholic" legislators. On the basis of this article, I would say that Levada is firmly orthodox and highly intelligent. Pope Benedict must know Levada's mind reasonably well after working with him for years on the CDF. Even if it is true that Levada was ineffective as the Archbishop of San Francisco --- which I am in no position to say --- that does not mean that he would be ineffective at CDF. The prefect of CDF largely deals with theoretical questions. It requires intellectual gifts rather than political ones. A man may be an excellent theologian and an ineffective administrator. I think it is really unseemly for people to be immediately second-guessing every decision the Pope makes.
No kidding! I mean, it's not like San Francisco is an easy post for a Catholic bishop. He must have felt like like Francis de Sales when he was made bishop of Geneva (i.e. "Hopefully I won't get lynched.").