Does a hero really level up?

While fighting monsters in a dungeon the hero is leveling up. After the dungeon is successfully finished, does that hero gains anything?

Solution 1:

No the adventures are from start to finish every time. The progress is the gold that you bring back to expand your guild and add into it new hero types as well as new starting gear to give you the edge and sense of advancement.

You do not keep the levels or gear you gained while in the dungeon, only the gold and boss trophies.

Solution 2:

Actually yes, upon completion of a dungeon, the hero will gain a "battle scar", of which he can have up to two at the same time. However, battle scars can have negative effects as well as positive ones (I think positive ones are better though).