Loving the game so far! I have a few questions:

1) I'm at level 5 right now, playing on Hard, and it feels like I've run out of content at my level range. The only creatures I am aware of are level 7 or higher. Is this uncommon? If so, maybe I'm completely missing an entire area.

2) What is the difference between companions and henchman, apart from the story elements (ie. their dialogue)? I have a level 3 rogue henchman I've been leveling (Arya), and I've been really enjoying her, but I hope I'm not missing out on something by using her.

I'm in the same situation, at level 4, on normal difficulty. I can't find anywhere I can go, any quests I can do, where I'm not out-leveled. I'm enjoying the game, but it feels like you have to do absolutely every single available quest to get enough xp to level to be able to progress an further with the story quests. And at this point, I'm stumped about what quest I'm missing doing, or what area I can find some creatures my level to fight. It's a bit frustrating.

You don't necessarily have to level up your henchmen (though you may choose to do so for the fun/immersion); you can tell her to leave the party for a moment. When you retrieve her at The End of Time, she'll gain experience to match your two mains.

As you say, there is no difference between henchmen and companions save backstory, dialogue, comments with plot points, etc.

As to your level, I think overall, people are finding they are leaving the town into the wilderness around level 3-4. The undead out of the west gate (not from the harbour) is the first area to hit. I think generally, you can proceed clockwise?

Fair warning, hard is hardest early on, but I find it a lot of fun. You'll learn the tactics quick!

By lv 4-5 you should have cleared the lighthouse. The you can go along the cave guarded by lv 5 zombies/boars/skeletons up north or west of cyseal harbour where you will find some orcs. Enemies in both areas are at lv 6.

Ah, thanks. I just found the cave last night, that was the area I had overlooked. The orcs will be a good transition from that I think, I had remembered them being higher than 6. It does feel that you have to do the content in the correct order to progress. I'm fine with it, it's a nice change to be able to clear everything, rather than be overwhelmed with side quests, lol.