When making a level, do you make it all in a 3D program? or do you make seperate assets and put them together inside unity? Which is better?
It depends how modular/re-usable you want it to be.
You can make 3 different room types, then just put them all together in different configurations to make an entire level of rooms.
For a unique real building feeling you would create one model for the whole level.
And of course for furniture/props etc, those would each be individual models that would be re-used throughout the game/level.