That level editor was more like an imitation engine done in Game Maker with which the intention would have been to make it versatile enough that you could build your own levels with it and it would play
more or less like the original game.
Essentially SligStorm was trying to make a completely new engine that looked like the old one but added the ability to load custom levels. That is a pretty tough project though, especially with the difficulty of getting graphics etc, so that would be why he scrapped it.
But making a good level editor for the
actual game is pretty much impossible since, as many above posters have said, the engine just isn't versatile enough - there's too much stuff which is hard-coded into the game. I think the idea of trying to actually create new levels for the original game was scrapped a long time ago, the work that's gone on since then is to try to create a replica engine (pretty much what I described above) which would use the original data while adding on a bit of customization ability.
But of course, the first step in doing that is reversing the original data formats, which is quite challenging as you can see by reading through this topic
Hope that helps
