Really enjoying the old school flavor of this game. Have about 30 hours in the game so far.
Here are some comments in regard to difficulty levels (there are 4 levels, i will call them easy, normal, hard, insane):
Easy: this is pretty much story mode, very easy.
Normal: In the first map you have the option to recruit a higher level NPC (level 8?), and will help with combat quite a bit. I found normal to be a cake walk with the NPC recruited. Without the NPC, it was a little more challenging, but still not hard enough, so i restarted on hard below.
Hard: Without the NPC, i was getting destroyed at the Ag Center as a first time player, so I restarted with the NPC. (I think its more fun with the NPC, as it adds some commentary here and there on missions). The first missions were challenging with the NPC, but not frustrating.
Insane: Did not try it, as hard was hard enough for me...
Some other random tips:
1) Character build: Try to get enough APs for 2 shots based on your weapon choice. Starter SMG, assault, pistol i think are 4 AP, shotgun, blunt is 5, blade is 3, sniper rifle is 6, hvy weapon i think is 6... (12 ap as a starter is tough, so you might want to go for 10 APs and have a second fast weapon skill.)
2) Intellgence is important for skill points, check the explanation text for how many extra SPs you get per level. There are tons of safes, traps, locks, etc so you will need those skillpoints. Make sure your starter team has at least 1 point (get 2 in each ASAP) in safes, locks, traps, computer sci, perception, field medic. Alarms, toaster, etc can come later. Note you get an NPC early with decent surgeon skill, and comp sci.
3) Watch out for the spore contamination disease - dont let it count down all the way (there are ways to cure this temporarily). If it progresses, and you get the Acute contamination which i found was not curable at all.