That's exactly right. What we know about all campaigning -- and spending money is a subset of all campaigning -- is that the more voters are already persuaded, the less campaigning matters. Obvious, right? In practical terms, that means that money matters
So in terms of affecting the election outcome, as a donor you should prefer primaries to general elections, low-press-coverage elections over high-press-coverage elections, and underfunded candidates over well-funded candidates.
Against that are the effects of winning different types of elections. Money is more important in primaries...but if it mainly helps one candidate beat a very similar candidate, the outcome might matter less than defeating the other party's candidate in a general election. Your $100 contribution is far more likely to swing a school board election than a presidential election, but presidents are far more important than members of the school board.
So there's no mathematical equation for exactly how to spend your money, but Yglesias is certainly right: it's hard to see presidential re-election as a good use of money, no matter how important the president is (and remember: as much as I'll talk about presidential weakness around here, I've also always pointed out that the president is the single most important single elected official). My guess is that for most partisans, the best choices are open Congressional (House and Senate) primaries in party-friendly seats with retiring Members, and close Senate general elections. But then again I should mention that I tend to have a strong and probably unjustifiable bias towards national politics; it may be that state legislative races and local races are really the best bets for many people.
I should mention too that not all money donated to candidates is for the purposes of affecting election results (it's also used for lobbying, or to secure access, and in some circumstances the motives are probably more social than political), but here we're talking just about money given in hopes of changing who gets elected.
Either way, I think Yglesias has it exactly right: it's very much a good idea to participate in elections, including giving money if one can do so, but giving to an incumbent president seeking re-election is almost certainly going to be one of the worst possible choices.
*Corrected. Money matters less in general elections than in primaries.