So when you dispense an item at a villager, the amount of emeralds you are supposed to get from the item, will go in the dispenser, but the villager will not level up because he does not know who he is trading to. If you dispense some emeralds at the villager, a random item he trades for emeralds, will go into the dispenser, and again, he will not level up. This is not very efficient, but I think it's a good feature to be in the game.
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