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Several tools exist that can help remove unwanted grass. The one you choose depends greatly on how much you need to remove and how hard you'd like to work. A sod or turf cutter is the fastest method while using a shovel is labor-intensive and much slower. You may also need a garden rake, tiller, and wheelbarrow. 

Generally, it is not necessary to remove old mulch before applying a new layer. As organic mulch breaks down, it enriches the soil with nutrients. However, you should remove the old layer if it shows signs of fungus or disease, which can be common in moist areas, or if the total depth is already too thick. Avoid letting the total mulch depth exceed 3 inches, as this can harm plant roots. If you do remove old, disease-free mulch, it can be added to a compost pile.

For minor unevenness, you don't necessarily need to remove grass before leveling. You can apply a topdressing mixture to fill in low areas and even out the surface. However, for more significant unevenness or deep depressions, it might be necessary to temporarily remove the grass to ensure proper leveling and soil compaction. After filling and leveling, you can replace the grass or consider reseeding the area.

Depending on the method you choose to remove grass, it may or may not matter whether the grass is wet or dry when you perform the task. A dryer lawn will be easier to negotiate with a sod cutter, especially if you're not planning to reuse the turf. However, using a shovel by hand might be a little easier if the ground is slightly damp but not so much that it sticks to the tool.