yep, Level 2 is real. wishlist it here!
this update adds the demo level for the upcoming Level 2 dlc, as well as achievements and tons of visual and mechanical additions/changes.
listing everything i've changed for level 2 would be impossible (i literally don't remember at this point), but here are some of the big ones:
there's color, and lots of new visual effects
the dash-punch now has strength tiers and rewards proper timing
landing a kill also grants you the air platform, not just parries
you can airdodge, and the ground dodge is far more controllable
jumps can now be charged, with a significantly higher max height than before
knockback is completely different, and a lot funnier in multiplayer :)
many of these mechanical changes are significant, and would completely break the way level 1 plays. so, the mechanics of the original game have been preserved in level 1 (now called Eraser Classic), while level 2 contains all of the new and changed mechanics that would break the design of level 1.
this isn't to say that level 1 is completely unchanged. it benefits from the new visual effects, achievements, and the more subtle and universal mechanical improvements such as buffered inputs.
...and that's all there is to say, i think. i gotta get back to finishing Level 2, and i hope you'll give the demo a try!