I personally feel that scaling should be done with consideration to how good a certain being can be expected to be.
A dragon can be anything from a little puke to a great wyrm, but if it has a reputation for burning down villages, it most likely has some prowess.
At the same time, a party of goblins can be expected to be vicious, but perhaps not dangerous to a party of adventurers that single-handedly killed the dragon above. Even if they have magical gear, the average level of a goblin should not be high, unless they've lived through some extreme experiences and actually come out on top.
A group of brigands that have only roamed the countryside harassing small farming villages, will probably not be very proficient fighters, or have any special gear, which should become apparent when the dragon slayers decide to help the little man and take care of the brigand threat.
On the topic of bosses always being challenging, just apply the above logic. Will a warboss be a fierce foe? Definitely, if he's bent the will of his army by his own might. If he's done it through manipulation - well, his elite guard is most likely quite dangerous.
The brigand boss? Most likely, he's not much stronger than the rest of the band, meaning most experienced adventurers would dispatch him quickly, and the handful of bullies that surround him.
Would the brigands be challenging to a group of fresh adventurers? Certainly. Would they get utterly destroyed by the warboss in an all-on-one? Definitely.
Would the same situation be true for a party of adventurers that have braved the dragon and lived? Would the ability of the brigands change based on that experience? Maybe, if they've even heard of the deed.
I think level scaling can be done, but it has to be believable. Is it reasonable that the brigands suddenly become powerful enough to level cities, while only going after small villages? Is it reasonable for a warboss to be defeated by a group of inexperienced adventurers, when he/she has bullied an army to march by himself?
tl;dr, I think level scaling works, as long as it doesn't break the suspension of disbelief. (And that happens ALL the time, in all the AAA-games I've played the last ten years. Godspeed, Obsidian.)