Nothing much has changed. The enemies have gotten more difficult (you can now draw bosses as random encounters, which is never an annoying mechanic), and my equipment hasn't really kept pace, but the core gameplay is exactly the same as it was 3 hours ago. I'm currently in the last rank of the story mode, and really flailing with the more intense challenge. I guess I should give the game credit for easing me into the rogue-like elements, but it does feel like a bit of a bait-and-switch. I got into the game expecting a certain degree of steady progress and now I'm hitting a brick wall. I expect this is merely a skill plateau, however, and once I have a little more practice, I'll be able to move forward once more.
And if not, there's always easy mode. It's an option I tend to avoid, because I have an irrational pride in being a "normal" gamer (I don't really bother with hard mode on games, either; I think the only exceptions are Viewtiful Joe and Fire Emblem: Path of Radiance). To downgrade on difficulty feels like admitting defeat.
It really shouldn't. Games are nominally played for enjoyment, not as an exercise in human dominance over an inanimate object, and I really enjoy the version of Hand of Fate that's a casual brawler/card-driven choose-your-own-adventure. So it makes sense to lower the difficulty. I'd just hate to do so if there's a possibility that I can rise to the challenge on my own merits.
It's not like it's a critical decision, though. I still have fifteen hours to go, and I will say this for dying and restarting from the beginning of a level - it does a lot to pad out the playtime.