I have finally achieved level 1, so I can talk about these things again!
It seems that our concept of leveling conflated two different ideas of self-improvement that should've been kept separate. The first idea is about trying out new things, like making pancakes, solving a trivial programming problem or playing the intro to "Smoke on the Water". Trying out new things is a lot of fun, but as many commenters have noted, it doesn't necessarily give you a long-term upgrade. (NB to everyone who considers me a strong rationalist: you'd change your opinion if you saw my pancakes!)
The second idea is about establishing habits of practice. Some goals force you to set up a daily routine before you can achieve them. In retrospect, that daily routine always turns out to have been the main thing of value, and the actual result is almost an afterthought. For example, my routine over the last several months has looked like this: cold shower every day, jump-rope workout and drum practice every weekday, strength training twice a week, travel every weekend. Once you get into the groove, you don't wanna get out.
So maybe instead of designing level 2 we could somehow incentivize each other to pick up (and keep) rigorous habits, e.g. write N words every day without exception? Any ideas?