We found how it works and how its measured. Took 3 of us and our instructor researching it but we figured it out with the help of a LG regional manager and some training manuals.
Pretty slick the way it works because the washer can adjust its water level almost down to the ounce of water it needs to wash a load, depending on what your washing.
When the washer starts and fills with water, the water level switch gets a pressure reading. Instead of either opening or closing a switch, it moves an iron "plug" inside of a coil. This coil is charged and measures how far the iron plug travels based on a magnetic field and inputs the reading to the main control board in KHZ. The main control board takes this info along with the load weight and figures out how much water the load is going to need. For example, if your washing 5 t-shirts, the washer will know it doesnt need as much water as it would need for say 5 beach towels and adjusts the water to a level that best suits the load thats being washed.