Question

does the level of water not change when sugar is dissolved in it

Answer 1

Water molecules have atoms arranged far away from each other. So there are much intermolecular spaces between them. When salt/sugar is dissolved in water, the molecules of salt/sugar goes into the these spaces. Thus no water level rise takes place. but as we go on adding salt/sugar, a time comes when no intermolecular spaces are left. This point is called saturation point and the solution is referred to as the saturated solution. 
Adding extra amount of sugar/salt in after it is saturated, the level will rise. but not before saturation.