In a large Dutch oven, cook the sausage, ground beef, onion and garlic over medium heat until well browned.
Stir in the crushed tomatoes, tomato sauce, tomato paste and water. Add the sugar, 2 tablespoons of the parsley, the basil, Italian seasoning, fennel seeds, 1 teaspoon of the salt and the pepper. Cover and simmer for 1 1/2 hours, stirring now and then.
Meanwhile, bring a large pot of salted water to a boil and cook the noodles for 8 to 10 minutes, until al dente. Drain and rinse with cold water.
In a bowl, mix the ricotta with the egg, the remaining parsley and 1/2 teaspoon salt.
Preheat the oven to 375°F (190°C). Spread 1 1/2 cups of the meat sauce over the bottom of a 9x13-inch baking dish.
Lay 6 noodles lengthwise over the sauce, slightly overlapping. Spread with half of the ricotta mixture, then top with one-third of the mozzarella slices, 1 1/2 cups of meat sauce and 1/4 cup Parmesan.
Repeat the layers, finishing with the remaining mozzarella and Parmesan on top. Cover with foil sprayed with cooking spray so it doesn't stick to the cheese.
Bake covered for 25 minutes, then remove the foil and bake for another 25 minutes, until the cheese is bubbly and golden.
Let the lasagna rest for 15 minutes before slicing and serving.