Hi Kat,
I thought of a horror story when reading your post
You're so kind (too kind?) that you tried to keep up & even gave a (warning) letter.
He's also courageous to go to see you. I think your letter helped.
Below are just my speculation:
IF he's not really having sleepwalking or whatever problem:
yes, it might be possible that he was in denial, because of
- embarrassment (so he might accidentally blurted it out),
- he didn't aware that the noise was too loud - he was still thinking about it maybe,
- and tried to 'negotiate' with you but he couldn't find proper sentences maybe,
- or he couldn't answer you in 'real-time speed', so he tried to make you believe him..
.. so that's why it sounds so absurd maybe.
But then maybe he realized that it's not ok, and tried to make you not angry with him anymore. So he apologized (?) for the noise. Maybe you've wanted him to apologize for being in denial or lying to you,
but maybe he didn't lie,
or if you think he was lying,
- maybe he doesn't aware that the noise was too loud for you,
- and maybe he was still 'processing'/thinking about the noise or what happened,
- maybe he was trying his best in talking with you;
with all these 'processing', these maybe made him didn't aware that he needs to apologize to you for lying; or even didn't aware that his denial looked so absurd, maybe. He may realize later, but missed the timing already, so maybe he doesn't know when to apologize, thus ended up not apologizing.
But maybe he already SHOWED to you his apology with that snickers. Maybe he speaks less but shows to you through his actions.
So yeah MAYBE he was in denial (because of embarrassment or lack of social skills or processing speed or whatever) and maybe he was lack of self-awareness in some parts. MAYBE. I might be really wrong though.
Or maybe it's just language barrier problem or some misunderstanding or whatever..
Dunno if this the answer that you want.
And I think it's ok to set your boundaries and be strict to people around you, with respect. It's tough dealing with situation where the other party might be lying to you or maybe not, and you still need to protect yourself.. I think no need to feel guilty too much since you've handled it well and politely/with respect.
Anyway, hope your problem solved gradually (maybe he needs to put more fluffy carpets for the walking noise. for the laughter, dunno). Hope you wont grind him (and yourself) too much, because of the poor experience you had here.
Dunno why you think your account will be deleted. Your posts sounded a bit rough, but the lack of sleep will make people angrier than usual.