HALIBABICA'S PROFILE

from LockeZ
I think the amount of difficulty that's "just hard enough" is different for every player. Some players are just more skilled than others. You have four options, really, that I see:
1) Design the game for players of a certain skill level. Players too far below that skill level will be frustrated and players too far above it will be bored. You can expect players to get better at the game as they play, so this skill level can slowly increase as the game goes on. This is what 99% of older games did.
2) Add multiple difficulty settings for the player to choose between. This opens the game up to a much wider variety of players, but it vastly increases the time you will spend balancing it. There's a very small subset of players who hate games with multiple difficulty settings because their brains are wired to always take the easiest path, but that path is too easy to be fun to them. But as long as you don't let them change it mid-game, this phenomenon usually doesn't happen to more than about 5% of players.
3) Have some sort of automatic difficulty selection, level scaling, or rubberbanding. This normalizes the difficulty for everyone at the expense of completely defeating the purpose of getting better at the game. This only works if players don't know you're doing it. Once they find out, a lot of them will be furious, many will stop playing, and the ones that keep playing will change the way they play to abuse your scaling system instead of trying to play their best (since trying to play their best is actually counterproductive).
4) Make the game easy, but distract the player from the simplicity by making the game keep changing, with tons of minigames, and new characters with wildly different playstyles, and other things like that. Make it so that almost the entire game is spent learning how to play new parts, which are played differently than anything before, and thus the player will never get bored. Although some players will exhibit mastery of gameplay after 5 battles and others will take 100 battles, no one will exhibit mastery on their very first attempt at something, and so it always feels "challenging" to some degree. This method is very rare because it HUGELY increases development time; you have to create a dozen times as much gameplay as you would with the other methods. Super Mario RPG is a good example of this.

from Takeshi's Challenge wiki
Throwing 30,720 punches on the opening game screen will also take the player directly to the game's ending.