The best leveling spots imo is Neverland, its one of the last zones so the enemies have good XP and there are a ton of them and just going from one end to the other will help level you up.

As for Master of Arena, you can either power level, get a friend to help in Link up mode, or build a set-up with high tier abilites (the ones that take up two slots) and spam the hell out of them in normal fights and abuse shotlocks for the bosses. Most people say Bio Barrage is best cause it does the highest damage but I prefer Lightning Ray cause it gives you way better invincibility and allows you to get past some of the nastier moves.

Which characters are you using?