Defining elevations of a path

I have roads going through the project site.  The elevations given are at random intervals.  Since the roads are curved, I must use many more points to define the road layout than there are points with given elevations.  

1.  What is the best way to define the road depth?  

2.  Will Kubla interpolate the elevations of the points based on the given elevations?

3.  Should I use heights or levels to define the road beds?  

I have a part of the road that once I completed defining the road, Kubla set the elevations of the points on the "Levels" at a grade almost 20 feet deeper that anything that I have defined either existing or proposed.  I have attached the file so you can see what is happening.  

Thanks Djungst