The level editor is, as its name suggests, an editor used to create and modify Graal levels. Currently the editor supports the level format of NW, but also backsupports .GRAAL formats as well. In the past it also used the format of .ZELDA, from Graal's old days as Zelda Online, though the editor no longer supports this format.
Support for the level editor has been discontinued in favor of an online editor. The majorities disagree with this decision, especially since neither offline, nor online has seen any sort of update since the offline editor was discontinued.
Graal has more recently seen more support for layers in levels, and because of this an editor that supports layers is in more demand than ever. Because neither the offline editor, nor any released online editor has favorable support of layers, no one can really take advantage of them leaving a very powerful feature with no use.
Besides more advanced additions like layer support, many have asked for simple things, such as the ability to adjust the size of the tile selection panel, or better/easier tiledef support.
Most grief of the matter of the discontinuation comes from the matter of no alternative being offered since then, and the administration's attitude that if the players want something better, they should make it themselves.