The new Overland Challenge Difficulty system sounds great in principle.
But the current description ("deal less damage / take more damage") creates a shared-world maths problem that needs clarification.1) The Shared-World Problem (Why Difficulty Can’t Be “Personal” In Practice)
In a shared open world, players on different difficulty settings will often hit the same boss at the same time.
If the boss has one shared HP pool, then a Normal/Adventurer player’s full damage will still melt the boss — meaning a Vestige player won’t actually experience a harder fight… they’ll just receive higher rewards.
Example using real numbers from my characters:

[]Character 1 contributes ~40k boss DPS in mixed fights []Character 2 contributes ~120k boss DPS to bosses

If Character 2 is Adventurer and Character 1 is Vestige (80% less damage → 20% output), then:

Combined boss DPS = 120k + 8k = 128k 500k HP boss dies in ~3.9 seconds

So the Vestige player’s “challenge” gets completely overridden.2) This Leads to Two Disappointing Outcomes
Players will conclude one of these is happening:

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Hard mode can be “cheesed” by nearby normal players []OR boss HP is increased globally to preserve challenge, making it harder for everyone (including players who didn’t opt in)
Neither is a win.3) Two Systems That Solve the Carry / Shared-World Issue
If you want difficulty to be real in a shared world, you need anti-carry maths.
A) Weighted boss HP contribution
When a higher-difficulty player is engaged, lower difficulty damage contributes less to the boss HP bar.
This prevents “easy-mode melting”.
Personal progress + personal rewards
Higher difficulty rewards only apply if the player personally completes enough of the fight under their chosen difficulty.
This prevents free hard rewards from easy carries.
Question for ZOS: Which of these systems (or equivalent) have you implemented for shared-world bosses?4) My “Perfect” Solution (Semi-Serious): Gear Gates
Want god mode? Wear what you want.
Pick Vestige difficulty?
You have a belt to hold your weapon… but nothing else.

[]No armour []No sets []Not even a weapon [](Why do you even need the belt?)

Daily buffs? Sure.
Potions? You can now carry a maximum of 5 health pots — that’s it.
Work backwards from those two extremes, and everyone will find their own level of challenge.
But here’s the real point:
Overland difficulty isn’t really about challenge.
If it was, we could already implement those rules ourselves. We don’t need ZOS for that.
The reason we need ZOS to add overland difficulty isn’t about engagement — it’s about:

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Bragging rights []Meaningful achievement [*]Rewards that prove you did it
This is the same reason players rush to be first to complete trials and dungeons: for a few days (maybe weeks) they get to strut their stuff with a sexy new outfit, a shimmering skin, or sitting on a mount making it rear up for absolutely no reason.5) The Best Solution: “Cadwell’s Campfire Stories”
Instead of forcing difficulty into a shared open world…
Create a new mode:
Cadwell’s Campfire Stories
Go see Cadwell sitting by his campfire, and let him tell you a story.
You queue into a dream sequence, and now you’re replaying those overland stories at a higher difficulty.
That gives:

[]True player engagement []A valid reward system []Meaningful replayability []No shared-world maths problem []No griefing / accidental carries []No forced global HP inflation

Because overland farming and average run-of-the-mill mobs in the world don’t really matter. They’re environmental filler. You can make them harder or easier to bypass — but it doesn’t change much.
Nobody truly cares about running around Alik’r killing zombies in mass, especially if they’re now 80% harder.
What we do care about is this:

Now that I have a fully fleshed-out character, I’d love to go back and replay the story — and when I fight Molag Bal, I want it to feel like I’m actually fighting something that could destroy the world if I fail.

Last time I ran that quest, the “big bad boss” was basically put to bed with a teddy bear… and an apology from me for being mean to him.TL;DR

[]Shared-world difficulty scaling doesn’t work unless you add anti-carry maths []The best long-term solution is instanced story replay:

Cadwell’s Campfire Stories [*]That gives real challenge, real rewards, and real achievement