There's nothing wrong with his eye. It's been that way since before I adopted him. That's the reason I adopted him - the shelter said that it was a permanent condition, but I figured no one else would adopt him anyway out of fear that he was sick. I'm glad I gave him a forever home!
Levi is a "tuxedo" kitty. He can see well, but his third eyelid will always be extended (something happened before I got him - I don't know what). It doesn't seem to bother him, though (not much does!).