theres a limit to how much the ground will go up with leveling, if its too low, you'll need to raise to even it up (requires rocks). Use your pickaxe to lower it to where you need it, trying to level a hill with just the leveling thing isn't going to work.

For monster attacks, mobs may randomly wonder to your base and attempt to destroy base structures if it sees them (torches, workbenches, etc). "Events" is when you'll be alerted monsters are approaching (the forest is moving, ground is shaking, etc). Where you'll need to defend your base for a couple minutes and then it stops. They will know where you are, so its advised to not hide or they'll wreck your walls and house.

Of course, using a raised ground wall or trench can make your base very difficult to penetrate, but if you're on a hill it should be easier to defend. Make the hill steeper or trench at the bottom. Place torches or workbenches (bury them slightly with only a bit poking out, so monsters cant attack them, if its completely buried itll be destroyed). This will keep mobs from spawning in a certain radius.