I also heard she was let go. Due to ABC wanting to go in a different direction and she not wanting that.
The first year was the best year. After that it was way too uneven.
One of the big conflicts was about getting Lois & Clark together in the first place.
LeVine didn't want them even really getting together until the 5th season, way off in the horizon, and wanted marriage as the series finale whenever that would happen. I remember an interview at the time where she talked about learning a lesson from Moonlighting.
But, the pinheads at DC, who already had them engaged for a few years (sustaining romantic tension was outside their world view) were eager to get them married. Creative bankruptcy being what it is, they struggled with how to have the wedding not happen before the TV show launch, as they wanted the comic book and TV series to have a wedding at the same time (this before the TV series was filmed and they had a clue on what it would be like and how it would appeal). This led to the Doomsday "Death of Superman" arc, which turned out to be successful beyond their wildest dreams. When they eventually brought Superman back like they had to, they were really in a bind to do The Next Big Thing to maintain the sales momentum, which led them back on the marriage kick.
In general, there was an expectation that the TV show would be more "action" and less "romance", and the Powers That Be just never figured out what made the show tick, and screwed it up totally. Canning LeVine was just another part of that.