You seem to have misunderstood how levels and power works in the game. All that gold as you put it, is rather useful, because you can spend that gold and items you get to upgrade your weapons which upgrades your stats, and to buy new spells and such. Sure levels give you some stat boosts too, but most of your power is going to come from spending money to buy new spells, and upgrade your self. In the beginning you often can only directly kill a few goblins a day before you can't kill any more. So then you pause, and spend some of the money you have to upgrade (because that ends the day) so then you come back healed, with your stats improved and do it again, and keep chipping away at things.
As for the story complaint ... we already had this discussion didn't we. Beating him up in real life gets you no where, he'll still have all that power come night time when he's in the other world, and you'll get in trouble with the police for beating him up for no reason that can be explained without sounding like you're completely insane. And as we pointed out, just killing him is hardly workable either. He's the son of a rich and powerful family, you can't exactly murder him casually, and you'll probably get caught and jailed even if you did.
Also, while it's balanced so you can do a pure run on normal first try, that is indeed rather hard to do on your first run without knowing exactly what to do. So if story mode is too easy, but the normal mode is too hard, fish a save off the thread, and use new game plus. You can get bonuses for a new run based on your furthest reached point if you game over, and several saves in the thread are meant to let you start a new game plus game.