Yes, I think you level it up in Mt. Coronet.
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To get a magnezone you have to level your magneton up on mount coronet
If you catch a magneton, you can level him up in Mt. Coronet to evolve him.
In Pokémon Crystal you can't evolve Magneton any further, because Magnezone was introduced with the IV gen games (Diamon and Pearl, Platinum).
Magnezone evolves from Magneton at any level. All you need to do is level it up once inside Mt. Coronet and it will evolve.
No, it evolves at Mount Coronet found in Sinnoh. Only in Pokemon diamond, pearl and platinum. Now you can also evolve it in Pokemon black and white. Level up a Magneton at Chargestone Cave and Magneton evolves.