AAAAAAAAAAAAARG whole post gone, stupid internet not working for no reason.
Multi-level thinking is fun, but is less used in the mircro-stakes, it's true. However, when players start to play you enough even at the .10/.25 level some leveling gets involved, particularly when you encounter another regular you've seen around. Even at the micros there are a few people that I get into 4th level thinking or so against just on experience. It's a nice little chess match to break up all the poker. But it sure can get you in trouble if you use it against the wrong players, put you on the exact opposite of what you should be doing. You can't bluff a guy who barely knows anyone else is in the hand.
Live games are great for it though, especially limit play, because it's cheap to experiment with a player and try to find out what level they're on in comparison to the money you'll take for knowing.