If I understand your question correctly, I think I may have your answer in this blog post:
https://evowebdev.com/2017/05/using-a-dropdown-menu-to-filter-a-custom-post-type-with-custom-taxonomy/
This solution specifically uses select form element auto-populated with taxonomy terms to sort CPT posts (ie, rather than presorting posts with pre_get_posts, it lets site visitors sort by the taxonomy term[s] they select). If it’s really important to pre-sort, this may not be an answer for you.
I could see it being useful, however, to allow people to select to view all courses of one of the levels.
That said, wouldn’t the following presentation occur with alpha order?
- Course Name level 1
- Course Name level 2
- Course Name level 3
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