That sounds like MMORPG endgame. Is that what you guys want?
How do you figure? It's a statement about how difficulty should be increased or decreased by tuning the value up or down. The "normal" way to do this is to make the bad guys require more punishment and/or dish more out. The challenges presented to the character are "harder" because they have to shoot more or gradually lose the ability to eat lead for lunch as the slider is increased. An alternative is to make the player have "less" at any given point in the game. Less skill points, fewer pieces of gear, a lower level, whatever.
The fundamental difference is in the "normal" case difficulty is added by lowering the margin for error for the player and raising it for the opposition. Combat isn't inherently harder in this case. The actions the player performs aren't innately more difficult. They just have to be executed better and more frequently. In the alternative, assuming a system of weapon sway, higher recoil, etc., those actions would be innately more difficult to execute. If you asked me which of these is better it's an easy answer.
I'd say the "normal" concept is more applicable to MMO's. Take WoW for instance. Cut out anything not considered end-game because their design model revolves around obsoleting their own content. They split this content up by giving a plethora of modes. In the harder modes the difficulty is due to a higher number of mechanics, more punishing mechanics and a greater chance of fatigue for the players due to needing to execute at a high level for a long interval of time. The first of these would be more "difficult". The second and third are more related to the need for better and more frequent execution.
I won't argue against players avoiding these harder modes because they merely want more shiny toys for the least amount of effort. This is precisely why there are easier modes available. Difficulty options available to the player provides the same functionality. If you want easy then play easy. If you want difficult then play difficult. While it is possible to make a purely "hard" game and get sales it's not financially intelligent because you condense your target audience.
If you watch this.. This is gonna be bullet sponge game. Theres one spot. where guy puts like two clips of automatic pistol clip into enemy and its still alive. At 5:30 theres boss fight, lots of cool stuff going on.
In fairness, I wouldn't consider that exorbitantly bullet spongey. The pacing is akin to TW3 when fighting equal level opponents. Many "bad guys" takes 1-4ish hits to drop. Obviously, the video shows a lot more than 2-4 bullets. Barring the shotgun anyway. Yet, the timing for TTD feels eerily similar to the pacing in TW3. Also, it's clear showcasing mechanics was the point to that video. I'd expect the amount of times the player is hit would be a problem on higher difficulties in the finished product (if not the combat is objectively easy).
Going the other way.... Any ideas what that combat reminds me of? To pick an arbitrary game, it reminds me of Doom. <- FPS.