The character freezing as you approach the gate to farglow is a known issue (though uncommon). Another person reported lowering the graphics options to get past there, and was then able to save and raise the graphics options back to where they were. It can help to head directly to the gate from the start of the game, and not delay or leave the path to kill rabits, etc. Usually, though, you should be able to quicksave if your character gets stuck there, then quickload and continue.
Unarmed combat should indeed be challenging at the start of the game. In DKS I played a ranger (on nightmare) that used some unarmed combat at the beginning of the game, but after a few levels I learned a couple skills and adjusted my tactics so that I rarely needed to fall back to melee combat. I'm actually planning on starting an unarmed warrior in D2:DC someday. In DKS I stopped distributing stat points after level 15, but I suspect that will not be possible with an unarmed warrior (strength being a significant factor in damage, since no weapons means no associated damage, bonuses or damage enhancing enchantments).
