The first game was brutal, but I honestly had no problems with the second game so far. That said... it depends on you. I played on Normal (Because Hard was basically impossible on the first game) and did not willingly lose, and breezed through things. If you lose to a demon, they gain some levels from you making them get harder and harder to beat. I'm not sure if it's possible to screw yourself over by losing too much. I did lose to the Moth girl a few times before backing off, grinding some levels back and upgrading some skills to go back and win.
With all of that said, grinding out Trust and skill points is very much a grind in this game. If you want to see everything, you're going to have to grind up fetish levels, give up your faith levels to the demons and grind them back to give them to others... very grindy indeed.