If you watch closely as you add distilled water you will see that when the electrolyte reaches the bottom of the fill tube it will form what they call a cats eye.
The fill tube has slots on the sides so the cell is still able to vent when it touches. If you raise the level so high in the tube that you cover the vent slots it will gurgle and burp electrolyte all over.
I never go higher than the cats eye. That gives you the most safety net if you go a little too long on checking them. If you run them just covering the plates then they are always closer to exposing the plate if you forget to check them.
If you are not charging hard at higher voltages you won't use a lot of water. If you are just looking in the hole and saying yes it's covering the plates, how long is it until it starts to expose the plate? You can do it either way as long as the plates are always covered.
Be careful when filling because you can get acid splashing. It's sulphric acid so it's best to wear goggles and have eye flushing water near.
Never make or break any wiring near the battery after it's been charging. Any spark may ignite the hydrogen gas that's in the cells and it's like a bomb going off.