[KevinH]

No Sigil does not ignore any h1-h3 entry unless you tell it to in the TOC Editor.

Note that toc links are typically to top of page and not to the title itself unless the h1-h3 is not near the top of page and an id exists in the h1-h3 tag so a fragment is included in generated link.

Each chapter or section of the epub should typically be in its own file. Not just one big html file for the entire book. There are Sigil tools to split files and to merge files as well.