I have been playing in hard mode and level ups fully healing me would have been really useful in the willpower dungeon. At least in hard mode level ups do not fully heal you.
If you want to lose, use the surrender button and the perk tactical defeat. Reason 1: No chance of accidentally winning. Reason 2: Free exp while "adventuring".
I just figured out the healing level up thing. In easy mode, level ups fully restore spirit, energy, and arousal. In hard/ normal mode level ups partially restore energy and arousal. For some reason, this info is not in the wiki.
Could be the challenge mod nerfing level ups. Other than that, I don't know what could be causing differences.
Forgot to add this. The partially thing came from me leveling up after beating the first salaris encounter in the caverns I remember that my energy was full but arousal was left at around 30 ish. (I don't fully remember details)
I don't really remember wether I was. Also, I am not complaining, I am just trying to figure out what the difference between the difficulties are. Another thing, I have read what the challenge mod does. The effects of the challenge mod are optional. the effects are either, 1: double spirit loss, 2: immediate loss on spirit loss, 3: no sex skills, can only use the whip and other holy weapons, or 4: nothing.