I was wondering if it would be possible to use the Spirit’s level function to switch on when the unit is level and turns off when not at level position. This Could help new pilot.

I am sorry, but I don't understand in what way it should help the pilots.
How you want to switch indicator on? And where the indicator should be displayed?

_________________
Spirit System developer

New pilots have a hard time keeping the heli level while learning nose in . I was wanting to put an LED on the bottom of the heli that would turn on when the heli is in the Level position and stay on only while level. When not level it would be off. I was also thinking a switch that would turn the feature on and off.

In my opinion it would be very hard for a beginner who cant proper hover look at an additional thing than the heli itself. And even more if we are talking of a light.
There cant be anything more obvious than a heli that is not level, regardless of its orientation, because it will start to drift. Then the beginner can start to correct in the opposite direction.
With a light he would just see he is not level, but not what he has to do... And the rotordisc is bigger than any light.

Other than that i strongly recommend a simulator, then nose in is a matter of some hours.

As someone who is still closer to learning to hover than doing 3D, I don't think it would help. The Heli is not level when it is hovering anyway.

However, I do think it would be great for setup, knowing the FBL is sitting level while I work on leveling the swash and setting pitch etc..

This is a great idea and definitv a worthy and awesome feature. And additional telemtry value for this, would be nice (no hardware changes needed).

actually i think not so useful to know how is the fbl while you are leveling the swash or setting the pitch

the level of the swash is always related to the main shaft so you can use a swash leveler
regardless of how the fbl is leveled (or the cheap zip-tie method)

and also for the pitch, when you know that the blade is perpendicular to the main shaft
(just use a screwdriver of the proper diameter inside the blade hole and look if is parallel to the shaft)
then you put on the blades and with a digital pitch gauge, you set the 0° then is all relative to that angle

IMHO

For learning how to hover we have GeoLink or few stabilisation modes.
You do not have to watch any LED lights.

_________________
Spirit System developer

For me, all of my FBL are mounted 90 Degrees to the main shaft. So it would help and be much easier than a bubble level.

i did not talk about any bubble level
and btw ALL fbl HAS to be mounted 90° to main shaft