In the options menu you can change difficulty settings. Not just Easy/normal/hard but also Enemy reinforcement frequency, limiting enemy reinforcements, as well as AI Sound detection, AI Sight distance, AI shooting reaction time and AI shooting accuracy. I think some rules about all this need to be defined and put in the rules section of the game.
I assume that the settings should be the default, but there's no way to reset to default. I assume then it would be "normal" on everything and "limit the enemy reinforcements" should be checked?
Should a run include evidence of these settings at the start of the run? Or can you just change them to whatever you want?
Difficulty can be changed at any time but right now I can't see any reason why you should change it to something higher. Of course, max difficulty gives you more brouzoufs, but... again, I don't know where it can be useful.
For NG+ I personally use lowest difficulty but reinforcements are set to maximum. More enemies on the map = more targets for Dragon's Breath.