no the nodes continue to spawn. If you simply hate it cover it with timber or a large stone, inside the model you'll never see them again.
Pathing does not level.
Level is from where your feet are. And also will remove vegatation. It will mitigate mob spawning, slighty AFAIK.

cool

Does it keep rocks, twigs, and dandelions from spawning as well?

I dont think so, a wood keep spawning at my stone path...

Path stops gras and bushes from regrowing.

As far as I can tell, pathen doesn't level ground? I just use it to remove grass. Helps stop it from poking above your wood floors. I guess it was intended to make dirt trails, without changing terrain geometry.