Well, we've always ruled that you gain hp, bab etc, but not anything that is uses per day such as spells. However that is probably a house rule, I don't know the actual rules on this if there are any.
If we're done playing for the day and the XP has been earned to level up, but we're in the midst of a dungeon crawl or something, I typically have them gain the HP that they just got from their new level (so it's like an extra 5-10 HP depending on class, CON score, etc.), gain the ability to prepare new spells, use new abilities, etc., gain new feats and skill points, all that jazz.
But, if there is anything that is a use-per-day thing (like class abilities, some feats, etc.) or spell-related (spells per day, spell slots prepared, etc.), then those abilities are treated as having been expended for that day already (i.e., the now-8th level sorcerer is an 8th level caster, knows Cone of Cold or whatever, has the ability to cast it the appropriate number of times per day, but is treated as already having cast it that many times that day; the now-9th level cleric can't prepare those new high level spells slots on the fly like clerics ordinarily can). So in the case of limited use stuff like that, they can't use them until they've rested.
That's how I treat it, anyway.
Wow, can I play with you guys? Our GM does not let us level up at all until the party is in a place and has time where we can do extra training, studying, resting, what-have-you. So, I guess to answer the OP, by this method of leveling, we do end up at full HP/rested with full spells.
I made the argument with our GM that the characters are learning and, gee, gaining experience, as they adventure and at least some of the benefits of leveling up should be an immediate thing upon reaching the proper number of points, but that's not how he rules it and the rest of the table seems cool with it. Since I am the only one who has a different take on leveling up, and I otherwise feel the GM is fair and I enjoy the group, I've learned to live with it. I'm glad to hear, though, that it's not the universal method!
Wow, can I play with you guys? Our GM does not let us level up at all until the party is in a place and has time where we can do extra training, studying, resting, what-have-you. So, I guess to answer the OP, by this method of leveling, we do end up at full HP/rested with full spells.
I made the argument with our GM that the characters are learning and, gee, gaining experience, as they adventure and at least some of the benefits of leveling up should be an immediate thing upon reaching the proper number of points, but that's not how he rules it and the rest of the table seems cool with it. Since I am the only one who has a different take on leveling up, and I otherwise feel the GM is fair and I enjoy the group, I've learned to live with it. I'm glad to hear, though, that it's not the universal method!
No, how and when to level up is purely a GM discretion thing. I think there used to be some directives in 3.5 that leveling up should be handled basically how your GM does it (opportunity to train, develop the new skills, etc.). That's how we used to run it back in the day. I prefer the idea that the training and experience happens as you're earning the experience, like you said.
The CRB suggests awarding XP at the end of the gaming session, so leveling up doesn't take away from gaming time. By and large though, it's left to the groups to figure out how they want to do it.
My group has always waited until there is "downtime". You don't level up mid-dungeon or mid combat. So you would get nothing.
As a GM I have done away with XP and have characters level when appropriate for the adventure. Which is never half-way through a dungeon.
The CRB suggests awarding XP at the end of the gaming session, so leveling up doesn't take away from gaming time. By and large though, it's left to the groups to figure out how they want to do it.
Our GM does award XP at the end of each session; if we hit the threshhold for the next level, we just don't get to do so until the party is, in game, in a position to take some down-time.
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For several questions it's helpful to track two numbers: your real damage taken and your total (current maximum) hit points. (When you gain temporary hit points or take nonlethal damage, those are extra tracks.)
In this case, if you gain a level while still injured, you have more total hit points and your damage taken doesn't change, so you have more, but not full, hit points remaining.