The creation of this mod is the core of my wishes for this game. But Lone Wolf game me a bad headache in the original 2 player mode (co-op). To be honest it needs a boost than anything. The game is hard as it is (playing on the hardest difficulty), as soon we get multiple enemies it gets annoying, fun but annoying. But my point being, Lone Wolf has a big sacrifice and the difficulty has a big impact on you already thanks to the enemy AI. If anything I think that 2 extra character should automatically have no partners because it be too many on the screen and a LONG wait per turn.
With that said, what really needs balancing is blocking, 100% damage reduction with only durability lowered. I always thought, the amount of damage you give is the force and skill/technique you have. So you parry the attack with no consequence is kind of dull. If possible depending on your percentage/number of your block, strength, defense rating, weapon/shield, willpower and luck/critical value (luck gives you a higher chance of getting a higher roll value) you should get a higher fatigue on the amount of hits you block (the more you block constantly, the higher your fatigue gets but get refreshed during time).
The thought process is that you cannot block everything without taking SOME damage of some sort.
That can be the balance Lone Wolf needs, sure you get powerful fast but the longer the game goes, you will be outnumbered and surrounded and cannot take the punch the enemy delivers.
Note: Kingdom Hearts did that, you can choose if you want to level up fast in the beginning or the opposite way.
P.S.
About blocking, my partner co-op player has a tank that can block 35% of the time, which is a low number but you block more than you think, add that 100% damage reduction with willpower, the resistance of the elements and on occasion some buffs it becomes a man of steel that absorb the direct damage even if you gotten surrounded and thanks to the heal skill Man-of-Arms has and the HP he has on the character, he can withstand anything. It sounds incredible but like I said, if you get surrounded with multiple enemies they will take you down eventually thanks to the mechanic of multiple enemies has. 1 strong hero won't beat multiple enemies without sacrifices, not alone.