"is not a decision by a politician to overturn a lawful decision by the judiciary a dangerous one?"
Well first of all, let's get the facts right. The original decision to extradite McKinnon was taken by a Home Secretary, not by the judiciary. John Reid signed the extradition order when he was Home Secretary, in 2006. The courts have certainly been involved in the case, but only by way of hearing appeals - no court has overruled the original extradition order.
The Home Secretary has always had discretion over extradition orders, it's nothing new, but it will come to an end. Theresa May has announced that in future individual extraditions will become a matter for the courts to decide.