I think the main problem with difficulty lies in the extremely easy access early on to many skills and a lot of items/money.
Too much CC available for the player.
Too much skills to counter anything the enemy can throw at you. Why was the first part ok? Because you still don't have access to so many skills.
Later on you can, buff, prevent being CC, CC the enemy, do a lot of aoe damage easily.
It's not just the AI, the enemy does pathetic damage. My LW hunters have both approximately 1000 hp at lvl 12-13 something, don't rmember exactly. And that's without taking other +hp talents and without investing in constitution. With all the armor and/or skills to decrease damage, the enemy just can't hit me so hard that it matters.
I just go in and smash them. If, when rarely they decide to attack my mage instead of my warrior i can simply go invisible or cc or teleport them or just buff my mage with some armor/damage decrease skill and don't care.
The player just has too many options to counter anything the enemy can throw at them, this makes the fights formal. The only thing close to challenge after the first town i had was when i was lvl 10-11 and was fighting lvl 14 mobs cause i wandered into some area that was not supposed to be for me (the NPC was saying - you are still too green for here), lol.
Even then it was okish, nothing special, but still interesting, and that's 2-3 lvls above. Granted, that with leveling up and gearing it's normal and ok and good that you feel stronger and stronger, but that means that the game should have more zones in which mobs are higher than your level where you can get a challenge.
It looks like the player development goes too far ahead of zones where you are and there is no challenge left.