I've only played USTA for a year, but my take on this is there are some regions of the country where the definitions fit the levels better than others, and within a region everyone is leveled, but their level may or may not match the definitions. When I came into USTA I was told by our pro I should be a 3.0, but maybe play some 2.5 warmups and see how I do. Well, it turns out the year before our region, NORCAL, didn't do all that well in adult womens at Nationals, so they thought those that played weren't quite at level using the formula determining how much they lost by. Since everyone's ratings hinge on everyone elses, the net result was a huge number of folks getting bumped down. The 2.5 ladies had tough first serves, could place their second, and usually played both at net. I fit in well with the 2.5 league that year, and in no level did the definitions fit. Well, lo and behold, NORCAL did well in nationals last season. Net result, I haven't found anyone that got bumped down, and from the number that got bumped up, it looks like everyone gained about .25 from the trickle down of matches played at Nationals. Some 2.5 women got bumped to 3.5, including much of some whole teams. This year I'm betting the 3.0 level will be less strong than last year, and be closer to matching the definitions.
On vacation I played social tennis with ladies from all over the US. We were playing somewhat even. USTA ratings ranged from 3.0 to 4.5. In social tennis some play easier than others, so higher level folks are often playing down to your level. Also, ratings from several years ago may no longer mesh with their athletic ability or the level of the region, as that too fluxuates.