Heat the oven to 375Β°F. Lightly oil a 9Γ13-inch baking dish.
Make the sauce: Warm the olive oil in a medium pot over medium heat. Add the onion and cook until translucent, 5β7 minutes. Stir in the garlic, crushed red pepper flakes, dried oregano, and dried basil; cook 1 minute until fragrant. Add the canned crushed tomatoes and water, bring to a simmer, then cook partially covered, stirring occasionally, 20β25 minutes. Season the sauce with 1.5 tsp kosher salt and 0.5 tsp black pepper; taste and adjust.
Boil the noodles: Bring a large pot of water to a boil and cook the lasagna noodles until very al dente, 6β7 minutes (they will finish in the oven). Drain, then arrange the noodles in a single layer on a lightly oiled sheet or kitchen towels to prevent sticking.
Make the filling: In a large bowl, combine the squeezed-dry spinach, ricotta, eggs, ground nutmeg, 0.5 tsp kosher salt, 0.25 tsp black pepper, and 0.75 cup of the Parmesan until evenly mixed.
Assemble: Spread about 1 cup of the tomato sauce in the prepared baking dish. Lay 3 noodles over the sauce. Dollop and spread one-third of the spinach-ricotta filling over the noodles, sprinkle with about 0.75β1 cup of the shredded mozzarella, and spoon over about 1 cup sauce. Repeat this layering (noodles, filling, mozzarella, sauce) two more times. Top with the final 3 noodles, the remaining sauce, the remaining mozzarella (about 1.5 cups), and the remaining 0.25 cup Parmesan.
Bake covered 25β30 minutes (cover the dish with foil; lightly oil the foil to prevent sticking). Uncover and bake until bubbling around the edges and the cheese is spotty golden, 15β20 minutes more. For extra color, broil 1β2 minutes, watching closely.
Rest 15 minutes before slicing so the layers set. Serve warm, topped with torn fresh basil leaves.