Do not take this as precedent, that Kotaku is going to get involved in every level taken down on LittleBigPlanet. But the demise of Azure Palace seems newsworthy for a few reasons - one, it's well made (a little too fly-and-grab for me, but still a good level); two, there seems to be no apparent reason for it; and three, it's the big stink in any forum now discussing Media Molecule's heavy-handed moderation.
This article was updated to include the following.
Update: I made changes to this story that removed direct references to Media Molecule, as I am not certain who exactly is responsible for the moderation of this game, be they MM or Sony employees. I put that back on Sony, as the publisher, in the above paragraph.
Further update: It is indeed Sony who handles the moderation. My apologies to Media Molecule for the misunderstanding.