What soundcard are you using? Most have some type of control panal that will show you the level of the signal coming in. I'd check this first, and compare that level reading to what is being displayed on that fader in Nuendo (with the 'in' button in). If you have some source that gives out a constant level, like a tone generator or even a drum machine it's good to know whether what you see in your soundcards metering is calibrated with Nuendo's metering. If they are not, then i'd tend to trust the soundcard's metering.
As for what level you record at, generally you want as hot a signal as possible without distortion. In digital, 0dB is the point at which distortion may occur. I record 24bit and usually have all inputs topping out at -1, but sometimes no higher than -6dB if I was lazy setting the input trim.
Also, the faders in Nuendo or Cubase do not adjust the input level. They are only used for adjusting playback levels.
