mum of twins, I have reread your post several times.You say your son has gone from a 3a in writing last year to a 2c - is this right?
To be top of level 3 in year 3 is great, but to go to the bottom of level 2 is a tall order. Are you sure it wasn't 3c? How did the teacher explain this - was it a blip on a written test? Where does the teacher assess him to be with his writing?
If I were you I would ask the teacher for an explanation of this. I know you said he is having a rough time of it right now but we are talking going down 6 sub levels. I am not sure this is an accurate assessment. Ask the teacher where your son is lacking - imaginative vocabulary, punctuation, not enough quantity. I am sure that with your help your son can begin to improve, you can help him at home with lots of reading. Try asking him to read to you his choice of book at night then you read to him your choice of book. Ask him lots of questions about the stories, what does he think will happen next etc.
I know all this does not answer your question re 11+ but I think its too early to be worrying about it - just work on improving your sons grades so that he can achieve his own personal potential.
Good luck. I am sure with a caring mum like you it will all work out good.