Yesterday I had a brief experience with this mod. Last version available at that moment and game patched to version 1.6. No other mods installed besides some texture mods.
My answer to your question: I found the difficulty in your mod to be fairly inconsistent. 2 examples:
Me against wolves: while I was fighting a wolf a second one surprised me with a leap attack from behind. I fell down as a result (cool! - I thought- that IS realism). The problems: a) from the moment I fell to the moment I stood up the wolf kept damaging me, b ) since the wolf was attacking relentlessly, as soon as the stand up animation finished I was sent to the floor again. I didn't have time to block or move out of the way. So, in practice: get knocked off once and you're dead.
Me against bandits: that was the other side of the coin. I don't know if it is because I play Dark Messiah and I'm used to go for the head, keep my distance and control my stamina but, well, I was basically getting so many bonuses with each hit that I could kill any bandit with two blows (the first one leaving them with 1% of their health bar or less and the second one being the killing blow). The problem here is that I was not having the impression that I deserved all those bonuses; I mean, in the end I was just moving a bit and going for the head but, according to my screen, I was actually performing feints, gaining momentum bonuses and so on. It felt a bit ackward. And I know you say that serendipity in combat is a good thing but, for me, pulling off great moves without actually wanting to feels like luck as opposed to skill.
Perhaps those bonuses should be a bit more difficult to obtain? For example: you need to attack while sprinting (and sprint for at least x seconds) if you want to pull off a linear momentum bonus. Or, for a feint to work, there must be a good distance between the body part you were originally aiming at and the body part you ended up aiming for (legs-head would work but legs-torso would not if the opponent is carrying a shield).
On a completely different note I would like to praise the slower 1-handed weapons' movement in first person. It felt MUCH better.