Shadow priests are absolutely fine at healing instances except past 60, from what I've seen. From there, it gets tricky; the shadow priests in our guild refuse to heal at the higher level instances (usually 70 ones, not sure about pre-70), not because they don't want to, but because they can't. But, all of them have stated that pre-60, they had absolutely no problem healing -- and, from what I've experienced, it's almost better to have a pre-60 shadow priest healing because they can do VE and heal. What tends to be the problem is that some (note, some) shadow priests just don't *like* to heal, and so they're lazy. I expect that from 41-59, they're just really not feeling it.
I gotta admit, I absolutely love shadow priests. They're remarkably one of the highest damage casters in the game, and compliment other classes very well. Typically, though, if someone has made the choice to remain shadow, I don't ask them to heal, unless they really want to. That's why I tend not to do pugs.. It's not always the specific class they are that's the problem. It's the fact that the player is an idiot.
Good tanks, though, are also as hard to find, but from what I've experienced, they're easier to make up for. DPSing as a druid, pulling aggro wasn't a big deal; mages can kite, warlocks have a decent amount of hit points, rogues can pop evasion, so unless it's a boss, a bad tank isn't *always* going to wipe a group. A bad healer, though... That could prove to cause different problems.
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Oh, BTW, I respecced Oomkin, because tanking Kara has gotten me stressed out.
I've gotten pretty much all the gear I can get from there, now; I'm sitting at 14k hp and 28k armor unbuffed, which I could probably improve even more, but a) it's decent enough, b) I won't be tanking Gruuls, and c) we have 4 other feral druids in the guild who I outgear by a huge margin. :-/
