The user manual doesn't really make it clear, but Darby is correct. You are in fact adjusting the recorded level. The good news is that you really can't mess up your levels recording with this kind of system (so long as you don't overload the input stage, which is unlikely).
I know this is splitting hairs and makes no difference, but the Zoom F3 sets the gain, you set the faders which is the finished product either up or down if needed. To quote the speaker in the Zoom video,
"I'll use the waveform magnifier as a fader to adjust the level of audio in headphones and on the recorded file"The words "fader" and "recorded file" at least imply that the magnifier is working on a file after recording. Again, it really does not matter in the 32 bit float world, but I'm just relaying what the speaker is saying. And I know Sound Devices does let you set gain, but the Zoom 2, 3 and 6 (maybe Zoom 8xx, I do not have that deck) set gain and you adjust the faders. You are adjusting the (already) recorded file.