Actually, it depends on how much Oxygen is in the air contained in the glass. The oxygen is consumed by the fire, and therefore the volume of 'air' is reduced. Adding more matches wouldn't raise the level, as they would go out as soon as all of the oxygen in the glass is consumed.

wrong but nice try, most people think that because it runs out of oxygen it creates a vacuum sucking up the water but you can get a higher level of water if you use 2 candles proving that this theory is wrong. its more thermodynamics involved in this small experiment. the air inside the glass is heated by the candle burning inside it making the air inside increase its volume but as the level of oxygen decreases the candle goes out. when the candle goes out the air inside starts to decrease its volume from cooling and creates a vacuum inside. the air pressure outside the glass then pushes the water inside in an attempt to equalise the pressure. when the pressure has equalised the flow of water into the cup stops. the more heat is put into the air the more it expands and the more water is put into it. so 2 candles, even if they burn for a shorter time still puts more energy into the air inside the glass. but this works only to a point because of the amount of oxygen in the glass eventually will become too limiting to sustain a large flame.

the origional theory would work if your were to burn a metal, ie magnesium

That's right, in fact,if you use a plastic picnic plate, you can get the glass to "suction" itself to the plate and actually lift the plate using the stem of the glass

Wow. It makes more sense now. thanks!