It should be checked hot. Off the top of my head, the process is something like:
Drive for 20 minutes so fully warmed up
Park on a level area
Slowly move the gear selector from park, all the way through the selections and back again
Repeat step 3
Move selector to "N"
Pull out dipstick and wipe clean.
Insert and pull out dipstick and read level.
The level should be between the "hot" level markers.
New, fresh fluid should be a red/pink colour. Old stuff will be brown, dirty colour, and can smell burnt. If you do decide to change it, not all fluid will be in the gearbox sump, so a drain and refill of the sump wont change all the fluid. There are a couple of ways to do a change:
Drain the sump and refill, run engine to allow the fluid to circulate, drain and fill, repeat as many times as you have fluid for.
The other way, drain and refil sump, disconnect the fluid cooler pipe going to the radiator. Run engine and allow fluid to pump out of the pipe into a container (don't do too much in one go). Refill with the same amount that has pumped out. Repeat process until the fluid is running clean. The first way is the easiest, but won't change as much of the fluid overall, the second way is definately best. I have just done the first way on my mk2 sport, the gear changes are much better and smoother already. I may well redo it the second way next time I order oil from opie oils.
Hope that helps.