In my first games 10 years ago I always used to choose the highest difficulty in all of them until I noticed that in most games it only increases the health and damage of enemies, i.e. the same game but with unjustified longer combats.
Great examples in difficulty increases was Diablo 2, where you need to end the normal difficulty to unlock the next level, and it is not about only more health and damage but more complexity where you need to achieve a perfect build to survive the first combat and you can't simply 'switch' the difficulty to easy, you ARE in that difficulty and you need to make your way or return to previous difficulty to get better items and more level. Also the game truly rewards that effort because if you want the best items you need to play in nightmare and then inferno, leaving the normal difficulty to casual players.
In this case, that menu option to turn the game harder maybe is a 'personal challenge' but the game does not encourage to play hard, you will not get more XP or better items for hard fights, in few words: such effort is not necessary to get the same result.
Difficulty scale must not be an option but a reward of finishing the previous difficulty and the 'necessity' to polish your build.
If you don't want a REAL difficulty scale and reward, remove that shameful difficulty selector and play like Baldur's Gate, a solid game with all the difficulty you need and where you don't even think to change difficulty.
