Level 3 Spikes is when you or an opponent sets up Spikes three times.
The first level is when you set up one layer of Spikes, which cuts 1/8 of your opponents Pokemon as an entry hazard. (As long as they are not Flying type)
The second level is one more layer after the first layer which cuts 1/6 of your opponents Pokemon's health as an entry hazard.
The third level is the absolute maximum and is only possible after the second layer of Spikes which cuts 1/4 of your opponents health as an entry hazard.
And as for Level 2 Stealth Rock, l've never heard of that before, and l do not know if that is possible.