Ah, Fox and msmith thanks for the clarification. I had already read the manual and workshop over a few times but I wasn't sure if they were simply not used often or what have you.

I figured they were more for buildings and the such where it makes more sense to build those large parts as a level.

I suppose as I gain more experience with the program the distinguishing characteristics will become more clear. I think my confusion is from the "compiled level" remark in the manual. I just saw a level as the whole thing rather than being able to create "levels" as parts of levels.