In a large Dutch oven over medium-high heat, cook sausage, ground beef, onion, and garlic until well browned. Stir in crushed tomatoes, tomato paste, tomato sauce, and water. Season with sugar, basil, fennel seeds, Italian seasoning, salt, pepper, and 2 tablespoons parsley. Reduce heat and simmer, covered, for about 1 ½ hours, stirring occasionally.
In the last 30 minutes of simmering time, soak lasagna noodles in a large bowl of very hot tap water, making sure the noodles are completely submerged.
In a medium bowl, combine ricotta cheese, nutmeg, egg, salt and remaining 2 tablespoons of parsley.
Preheat oven to 375 degrees F.
To assemble the lasagna, spread a ⅓ of the meat sauce into the bottom of a 9×13 inch baking dish. Arrange 4 noodles lengthwise over meat sauce. Spread ⅓ of the ricotta cheese mixture over the noodles. Top with ⅓ of mozzarella cheese slices and ¼ cup of parmesan cheese. Repeat 2 more layers, finishing with the mozzarella and Parmesan cheese layer.
Spray one side of a piece of foil with non-stick cooking spray (to prevent the cheese from sticking) and cover the dish.
Bake for 25 minutes. Remove foil, and bake an additional 25 minutes. Cool for 15 minutes before serving.