As a general description, I've always felt that a Game Designer works on the game as a whole...while the Level Designers work on segments focusing on Second to Second encounters.

Game Designers tend to work more in spread sheets, design docs, and wiki pages...while Level Desginers work with more hands on tools creating the space where the gameplay will happen.

I'm learning now that even those distinctions need more breaking down when it comes to classifying designers these days. Some level designers are just better suited to particular parts of the process. One guy may be fast at creating great game play environments, while the next guy is more skilled at taking that envorinment and making the gamplay happen.

I used to be set in the thought that one person should take a level and totally own it to completion. Now, i'm starting to see how the proper use of strengths of your personel can make the game better as a whole.