Yes. This bug is definitely STILL present in the game. You don't really expect to be attacked by a level 20 foe, when the game says the quest is suitable for level 11. Anyone know a fix to this?!
It's not a bug. It's the design of the game.
As
@Draconifors states above, the game is not catered toward scaling to every level (similar to something like The Elder Scrolls or Diablo). It's an old-school approach, with different areas of the world / quests statically scaled to different levels. If engaged by enemies that appear orange or red threat level, you're in for a nearly insurmountable fight. You need to run away. If they have a red skull by their indicators, the game is basically trumpeting that you're likely to die outright. While it is an open-world format, it's truly not a "go anywhere, do anything" kind of game. Best bet is to follow the plot and take on contracts at your level until you get a feel for what each area is like.
Basically, you should be able to annihilate anything at your level or below (grey or green). It might take some potions or decoctions to be able to handle challenging enemies / quests (yellow). You're going to be in for a stiff challenge if you tackle hard scenarios (orange). And deadly challenges (red) basically mean you've got little to no chance of handling it. You might even break numerous weapons in a row causing only tiny amounts of damage.