Erin,
The keyboard backlight setting is actually NOT a Windows feature. It is controlled by the laptop's hardware and firmware, rather than Windows itself. This means Windows does not have a built-in setting that allows you to manually adjust the keyboard backlight brightness.
On many laptops, the available brightness levels are predefined by the manufacturer, so if your Function key only cycles through two brightness levels and Off, those may be the only modes supported by your computer's firmware.
However, some manufacturers provide their own software that allows additional control over the keyboard lighting. For example, Lenovo Vantage, ASUS Armoury Crate, and certain other manufacturer utilities may offer additional settings, depending on the model.
Can you please share the manufacturer and exact model of your laptop? I can check whether your particular model supports additional brightness adjustments beyond what the Function key offers, or you can also check with the manufacturer support to inquire about it.