Making navigation and lane changing decisions is part of level 4, according to Federal Standards.
Full Self-Driving Automation (Level 4): The vehicle is designed to perform all safety-critical driving functions and monitor roadway conditions for an entire trip. Such a design anticipates that the driver will provide destination or navigation input, but is not expected to be available for control at any time during the trip. This includes both occupied and unoccupied vehicles.
No, Level 4 is a system where the driver never needs to take control (as in a vehicle that does not even need controls at all other than inputting a destination). A level 3 vehicle would still be able to make turns and change lanes, but will not be able to handle all road conditions (such that it has to notify the driver to take over).
The SAE definition makes this more clear:
Level 2 Partial Automation: the driving mode-specific execution by one or more driver assistance systems of
both steering and acceleration/ deceleration using information about the driving environment and with the expectation that
the human driver perform all remaining aspects of the dynamic driving task.
Level 3 Conditional Automation: the driving mode-specific performance by an automated driving system of
all aspects of the dynamic driving task with the expectation that the human driver will respond appropriately to a request to intervene.
Definition of dynamic driving task:
Dynamic driving task includes the operational (steering, braking, accelerating, monitoring the vehicle and roadway) and
tactical (responding to events, determining when to change lanes, turn, use signals, etc.) aspects of the driving task, but not the strategic (determining destinations and waypoints) aspect of the driving task.
http://www.sae.org/misc/pdfs/automated_driving.pdf
A system that can't change lanes on its own would not be a Level 3 system because it does not perform
all aspects of the dynamic driving task.
Note, in all levels, the strategic aspects (setting the destination and route to take) is determined by the human, but I imagine in the future with even smarter AI will be able to make such decisions by you providing a schedule or just an activity you need to perform (for example needing to go to lunch, and the computer decides where to go to and what route to take).