According to the walkthrough from KH Ultimania (the website), the forms can be leveled up further after getting the next form. For example, Valor can go above 3 after getting Wisdom, it can go above 4 after getting Master, and it can go to maximum after you use Final for the first time. THIS IS FOR KHII. I DON'T KNOW WHAT THE DIFFERENCE IS FOR KHIIFM.
As for tips:
- Valor: Before getting Wisdom, use often. Afterwards, it is the best form to level up on Bosses, because of how it levels up. Barring that, level it up in the Antechamber and the Palace Gate in the LoD, since there is a save point in the Throne Room, and because Assault Riders are decent targets. Equip a weak second Keyblade so you don't defeat enemies too quickly.
- Wisdom: Timeless River is a good choice, going between the four doors.
- Master: LoD again. Equip many Jackpot abilities, including the Wishing Lamp.
- Final: TWTNW or Twilight Town. KH Ultimania recommends Naught's Skyway. I recommend Yen Sid's Tower (there is a save point in the Sorcerer's Loft).
For all of them, having Oathkeeper equipped is recommended.
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