"Too good for Riddler"? If written properly Riddler is one of Batman's most fascinating and intriguing characters. The books are so inconsistent with the character, but when Riddler is well-written (Hush, for example), he is second to only Joker and maybe Two-Face in the rogue gallery.
On film, Riddler presents an opportunity to have a Bat-villain unlike any other, basically Batman's intellectual equal (and arguably superior). Every move Batman makes, Riddler should anticipate. He is a chessmaster. Basically the Littlefinger of the Bat-verse. In fact, come to think of it, Aiden Gillan would make a damn good Riddler. But I digress, if anything, Gyllenhaal is ill-equipped to play such an intellectually focused character.