Personally, I think level packs are more suitable for managed (unconsumable) items. You can create many sku(s) which correspond to each level pack. Query items code looks like http://developer.android.com/training/in-app-billing/list-iab-products.html#QueryDetails or http://developer.android.com/training/in-app-billing/purchase-iab-products.html#QueryPurchases.
And yes, purchase items are cached locally by google play service, see description in above 2nd link.