Great idea! I am so terrible at word games that I couldn't get past the 2nd level ....
Edit: I had a bunch of words on the second level that didn't work, so I though I had to place the word in a way that made 2 words at a time (as it says "words played" at the top. It could maybe say that the word isn't in the dictionary, and flash red or something?
I like all the little fading animations etc that you have added ;)