The levels in dressage are kind of like levels in horse shows. It's all about different maneuvers and difficulty. Like kids start out at level 1 which is basic walk, trot, lope, figure eights, circles, easy stuff. Then level 2 gets harder and so on. Then you have Grand Prix for like Olympic riders who do complicated things like the piaffe, pirroutte, tiempes where they change leads every stride or every other stride-very tough. Wiki has some basic information on dressage.