For those of you who have started playing the game already (or maybe finished), what's your opinion on the difficulty. I'm mostly interested to know if the hardest difficulty is challenging, or if it feels too easy (for being the hardest difficulty).

Also I'm interested in how the AI is compared to other shooters (is it raising the bar like FEAR, or is it rather average), and some general info about it (like if you can notice different AI behavior between factions).

I started on hard, and it isn't too hard you regen fast and if you die you can auto-defib yourself back to life. The defib is on a fairly short timer as well.
I am impressed with the AI they react when you shoot them and the melee guys that charge don't run in a straight line, the wall run and flip off things in the environment, I've only fought 2 or 3 factions, havn't seen the Authority yet.

I am expecting nightmare to be a challenge though, based off hard mode.

It takes several bullets to kill enemies.