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I'm wondering how the difficulty level affects the game?

As for my taste Cyberpunk 2077 is way too easy on hard game difficulty. I have no big problems even doing quests which are marked as "Danger: Very High".

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    In my personal experience, the difficulty of quests depends highly on your equipment and playstyle. Stealth is by far the easiest playstyle, allowing for instant kills with virtually no risk. Likewise, "smart" weapons make combat extremely easy, to the point where all you have to do is hide behind cover and click.
    – MechMK1
    Dec 23 '20 at 23:11
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    Yes there are definitely some playstyles that straight up break the difficulty - stealth and anything that results in one shotting enemies (sniping) comes to mind
    – kalina
    Dec 24 '20 at 15:16
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Difficulty impacts the attack strength, attack accuracy, overall health and resistances of AI opponents. On higher difficulties opponents will attempt to hack you or throw grenades at you more frequently.

Regardless of chosen difficulty setting, enemies do not scale to the player's level so if you clear lots of side content you will always find the main story to be "too easy", regardless of difficulty you're playing on.

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