It's exactly what it says, where are the best places to get more levels and good items? Currently, my party is around level 12, but I'm not sure what's a good level to beat the game at. Also, I've been wondering this for a while, but does leveling up increase more than HP and SP?

Knights, paladins and archers get an extra attack every 8 levels (at level 8, 16, ...) so their physical attack power increases.

I can say that spot is very good for level grinding. Item grinding, I do get good stuff, but it doesn't drop very fast. Are there any places where I can get the best stuff reletively quickly? Now, about what level should I be before taking on the endgame? Currently, my lowest level characters are at level 19.

You've already more levels than needed.

Do I now? About when could I have gone to beat it?

There's no need at all to grind in MM1 (or just about any CRPG for that matter). The most difficult part is the beginning. Once your've survived the beginning, it's merely a matter of being cautious, avoid the high level areas and explore the low level areas first.

Did that, now I just want to be overpowered so I can easily beat the game and finish my map of the overworld

The Astral Plane is the second best place for repeated high level encounters. The Soul Maze is the best, but going back is probably too much of a hassle.

I remember finding that my characters hit more often (and maybe did more damage?) at higher levels. Enemies that would give me a lot of trouble would become much easier after gaining a few levels, even with no other meaningful change. Also, kmonster is correct about the extra attacks, and of course you're aware that you get access to better spells at higher levels which make a huge difference.

If you still want to power-level, you can take on the mythical beasts, then head to the southwest island for the reward, then head to Castle Dragadune basement to convert your gold into experience (gather it onto one character if you want to boost their level in particular; I did this with my Sorcerer to help get him higher spell levels more quickly). You can repeat that process as many times as you like. But that may not be faster or better than grinding near Algary.

Note that there are some optional places that are tougher than the end of the main story, if you want to test out your high-level party. Like the dragons in the southeast; there are probably others. I actually didn't end up defeating them all when I played. I think I finished the game with my party level in the 12-15 range or so.

Also note that there's a lot more opportunity to power-level in MM2, including many optional areas that are super tough and require a high-level party (unless you use some sneaky tricks). You can import your MM1 party, but they'll be leveled-down a bit and lose all their equipment.

Thanks for all this, I ended up beating the game a little bit ago. Ended with my party being between level 26-34, which was probably a bit much. May take a bit of a break before moving onto 2, as this is about all I've been playing for over a month.

Congratulations on the win! I also took a break before playing MM2. It's very similar in feel to MM1, although the world map is much more open and you can go to crazy high levels and fight hordes of monsters. I enjoyed it a lot, although I slightly preferred MM1, but many players like MM2 better. I'm definitely glad I took a break in between them, though.

If you've got the answer to your question, please mark the relevant post as the answer.

And congrats on the win! :)