Steep difficulty can be appealing. Take the case of indie action-adventure title Spelunky, where the sense of discovery and achievement is maximized by stiff odds. "I think that a tough challenge can make a game much more enjoyable," said creator Derek Yu. "Don't we feel the most fulfilled when we overcome something difficult? Without that feeling of getting better, a game turns into a chore - something that you do as a distraction rather than something you do for fulfillment."
The key to effective difficulty, as opposed to frustration that's just frustrating, is all in the implementation. "Doing something hard isn't fun in and of itself," said Yu. " It's not fun to sit in an empty room and try to balance a ball on your head for 10 hours straight. To make challenge effective, you have to provide an interesting game world and create deep mechanics that are entertaining to play with and very satisfying to master."
Woo another well known gaming site publishes a story with high praises for Spelunky! You can find the rest of the article here