Think I agree with Elves, the prepared spell must be in a spell slot, and Versatile Spellcaster doesn't specify an empty slot.

The "slot" does float, then, but only when you prepare spells rather than instantly. You have to take the time required to prepare the new spell, at which time the Domain Wizard slot would float up to the next level too.

Or it would if the trick worked, anyway, because it doesn't unless you allow VS to exceed the caster level limit.