How do you level your turntable?

I use a cheap, 1" long bubble level (not a round one, which would be pretty useless).

To compensate for the inaccuracies of a bubble level, if any, all you have to do is spin it 180 degrees and re-check on the same axis. If the results differ, halve the difference and you're level. Nothing could be simpler.

Piedpiper's right.
1. Level the TT stand
2. Level the platter top surface
3. Adjust the tonearm mounting so that its bearings are level. This is easier on some arms than others of course.

Levelling the headshell is a good place to start, but whether it should remain level varies with the cartridge. Nearly all cartridges benefit from fine tuning of both azimuth and VTA, which could result in a non-level headshell, depending on the rig.