Having just completed Honour Mode with a co-op partner, I can safely say the game is very difficult for novice or casual players.
It is, however, hilariously easy for players experienced with the first OS game or the genre and turn based combat as a whole; even a basic mastery of the mechanics and some preparation can allow you to complete every encounter without serious resource loss, and it only gets easier from there.
In order to challenge players that know what they are doing or exploit mechanics effectively, self-imposed restrictions must be created (thematic action restrictions, no source abilities, no civil skills, etc); the game itself does not have the encounter design or mechanical polish to really challenge players of high skill frequently enough.
