ePub output of numbered lists has unwanted gaps between levels

Part of this may be the EPUB reader you're using. View it in Calibre or Thorium and see if the gaps persist there; if not, it's an artifact of how the reader you're using chooses to style HTML list elements.

You can control formatting to some extent by using unique styles for each level, but for the most part, close control of lists with consistency across readers needs at least a little CSS assistance at export. Oddly, InDesign does not define the <ol> or <ul> elements, so sometimes a simple CSS definition for those can fix these problems. (each of those levels will be wrapped in an <ol> pair, for example).

Try this — add the following line to a plain text file, save it as ListFix.css, and include that CSS file in your export.

ol, ul { margin:0; padding:0; }

This will probably get rid of your gaps but may also kill your level indents. If so, try this instead: (OOPS - edited this later)

ol, ul {
margin-top:0;
margin-bottom:0;
padding-top: 0;
padding-bottom: 0;
}