But the key might be when he writes:
an adaptation works best when it is a genuine transaction between the old and the new, carried out by persons who understand and care for both, who can help the thing adapted to leap the gulf and shine again in a different light.
So does that mean The Godfather is a successful adaptation because it resulted in a major film or an unsuccessful adaptation because a bad book would have been faithfully adapted to become a bad film? Who cares whether somebody making an adaptation cares or even understands the original - I haven't the foggiest idea whether Ford & Nugent cared for Alan Le May's novel The Searchers or in fact had even read it (though it's a safe bet Nugent had). (There's a story that Cronenberg was well along in production for A History of Violence before learning that it's based on a book and that's completely plausible for filmmakers working mainly off screenplays.)
This is just shows that what Rushdie is writing about is actually something much more specific than adaptations. He's concerned with adapting "brilliant books" into brilliant (or at least good) films. So what? Why should it make any difference as long as the resulting film is good? It might be unfaithful to the book or even practically unrelated but as long as we get a good film out of it that's all that matters.