I've searched this on Google, and I have some understanding of it.

Difficulty does NOT affect your skill gain, but it does affect incoming and outgoing damage, which in turn may increase certain skills faster than they would on lower difficulties.

I know it is lame to do, but I am power-leveling my Block skill. Simply Blocking while a Wolf attacks me. If I raise the difficulty up some, will I level up faster?

I guess if you are getting skill experience per hit, and you have to hit the enemy twice as much, then that would be true. Unless they scale that with difficulty. I hadn't thought about that really.

Difficulty does not directly affect skill gain, but indirectly it does. Because your enemies take half damage, you need to double the number of hits. Experience gain depends on the base damage value of the weapon inflicting damage and the number of times you hit your opponent.

Let's say opponent has 500 health.
Steel Sword has base damage of 10.
You have an improved steel sword and have 100% damage enhancement due to your skill. Let's say smithing improvement is worth 10. So your damage output is (10 + 10) * 2 = 40
In adept, you need to hit your opponent 13 times. Your experience gain is 10 * 13 = 130
In master, the damage your opponent takes is halved, so you need to hit your opponent 25 times. Your experience gain is 10 * 25 = 250.

So, you need to hit your opponent with your weapon the same number of times in either difficulty to gain the same amount experience. But you need to kill fewer number of opponents to achieve the number of hits. So I guess it depends on how you define "faster".

If blocking increases per hit.. Then the easiest difficulty is best to power-level on.

If it, however, increases by damage done to your shield.. then master is best.

If I'd have to take a guess between which on of these it is, I'd say it's the former.

it increases by damage

This is an interesting question and I just tested it. Indeed, the difficulty level does not make difference on how much experience you gain from a hit.

Turning up the bar will defintely make level up faster. Especially after the softcap of 50.

Maybe I need a higher difficulty... It's hard for me to get past level 30 with about 150 hours.

I discovered Block increases depending on the amount of damage done to your Shield.

I was toying around with Giants earlier... running near them and blocking their hits, and shield-bashing when they power-attacked. Leveled up my Block pretty fast... on Novice that is. (and by fast, I literally do mean - fast).

You gain experience based on damage done. The difficulty slider affects damage output from you and your foes. Your enemies will has the same amount of health regardless of the difficulty you're playing on. The potential skill gain from a specific foe is the same on all difficulties. Technically, playing on the easiest setting would level you up the fastest because you do more damage faster, aka gain experience faster.

This is exactly the opposite of what I found in my testing.

Given the same weapon, same skill level, and same opponent, each hit you inflict on your opponent yields the same amount of experience points in Novice, Adept or Master. The difference between different levels of difficulty is that for each hit, the amount of health lost is adjusted. When you are in Novice mode, the opponent takes double the amount of damage. When you are in Expert mode, the opponent takes half the amount of damage.

Blocking experience works the same way, given the same opponent and the same type of attack, each hit you block with your shield results in the same amount of experience gain whether you are in Novice, Adept, or Master. The difference between different difficulty level is the amount of health lost to the attack. The amount of health lost is halved when you are in Novice, and doubled when you are playing in Master difficulty level.

So, to clarify. If I'm playing normally and want to increase my experience faster, I would choose to play in Master difficulty, because each battle will last longer. I would need to hit my enemy more times to kill him, and during that time I would get hit more.

But if I wanted to increase my blocking skill quickly, I would set the difficulty level to Novice and go to a giant camp and block and heal. Getting hit by the giant would give me the same experience as in Master level but I would be able to take more hits, and have lower chance of dying meanwhile.

You do not gain experience based on damage done. Your experience gain only depends on the type and base damage of your weapon. A Legendary Steel Sword will give you less experience than an unsmithed Daedric Sword. Enchanted gear and fortify potion will not change the amount of experience gained per hit. But for most people it will seem like you gain more experience when you do more damage, because most players will switch to better class of weapon as well as increasing smithing improvements and gaining skills and getting better enchantments all at the same time.