I found when hunting around for an engine builder that it's very dependent on the company (read 'arbritrary').
But roughly I see it as:
Stage 0= rebuild
Stage 1= Stage 0 + balanced end to end (inc clutch), matched ports, equalised combustion chambers
Stage 2= Stage 1+ new cams, ported/flowed head, increased comp ratio, lightened flywheel
Stage 3= Stage 2+ lightened/forged internal components e.g. pistons, rockers/cam followers, stiffer valve springs to accomodate higher RPM'S, higher valve lift, bigger valves.
Totally different to what some people say because again, it's arbritrary.