I think what we can all agree on is this: There has to be a balance between gaining levels and feeling a reward. Adding thousand levels doesn't add anything to your game unless it's actually fun/challenging/interesting to gain said levels. Keep in mind that most people will tire of a repeated formula quickly; you have to mix things up. One simple (and standard) way is giving out new skills at certain level intervals, while stats increase incrementally each level. This provides the player with a feeling of small growth at each level up, and a feeling of bigger growth as they earn a new ability.
The important part is designing your game around your levelling system, if you have it; you can't slap a low level cap on a formula meant for higher level caps, nor vice versa. You have to think holistically, taking all parts of your gameplay into consideration.
