My understanding of the reasons for the change are that
-the way the levels were defined, it was not very difficult for an elite skater to earn level 4, so most skaters started with the same base mark anyway and the only distinctions to be made were on quality
-most skaters were using the same features to earn levels, which led to many spiral sequences looking the same and cut down on creativity or fitting the spiral sequence to the program theme and musical phrasing
-skaters were choosing to include variations that would gain more points (ensure a higher level) even if those variations didn't look good on their individual bodies
By eliminating the levels from the spiral sequence, the hope was that skaters would design their spirals to fit the program and showcase their individual strengths better and to give the option of holding one position for a longer time rather than being required to include at least two different positions (as was always the case in long programs -- 3 were required in SPs).
Eliminating spiral sequences -- or second step sequences for men -- from the short programs was to give more time for in-between skating outside the elements that specifically suited the individual skater and program theme, which may or may not include spirals.
I think there are arguments in favor of both approaches -- I'm not sure which I prefer.