McFadden was taken off at half-time during the fortunate 2-1 win over Liechtenstein and Levein was less than complimentary about the former Everton player.
But McLeish, whose side entertain Liverpool on Sunday, insists McFadden's commitment cannot be questioned.
He said: "I've worked with James for a long time now and he is actually one of the best trainers at the club.
"I can show you James' figures and they are way up there in terms of sports science. If anything he probably does too much in training.
"I don't think there should be any aspersions cast against James. He would walk over hot coals to play for Scotland.
"The last year has been typical James McFadden. He has been mercurial for Scotland, a real talisman and the Tartan Army love him - and he loves them back."
McLeish added: "James deserves respect and I am sure him and Craig will go on to have a good relationship.
"I am not going to take Craig Levein to task because he has criticised one of my players.
"I will continue to manage players my way and Craig has got to do it his way."
Birmingham are unbeaten in their last eight league meetings with Liverpool but McLeish expects new manager Roy Hodgson to make them difficult to beat.
He said: "If I am comparing it to Roy's Fulham team he will make it very difficult to penetrate.
"He organises his teams very well. He's been in the game a long, long time.
"Liverpool are using a slightly different style this season. Roy will stamp his personality on the team."
McLeish, who is optimistic of signing a new contract in the next week, will make a late decision on whether to give a debut to newcomer Alexander Hleb.
The on-loan Barcelona player suffered a knock to his ankle when on international duty for Belarus against Romania in midweek.
McLeish said: "He limped in the door and we thought 'no chance' and we think he has got to a stage where he has got half a chance.
"We just have to wait and see his progress over the next day or so.
"He got a kick in the ankle and it upset the ligaments a bit. We won't take any chances but he's got half a chance."
Veteran striker Kevin Phillips and defender Stuart Parnaby are still ruled out through injury.