This is all from a single player experience, I assume the game is slightly easier in multiplayer. Having gone through it now there's quite a few things I would have liked to know beforehand to make it less of a pain. It's fairly difficult but extremely backloaded, I went in with level 50 balanced (no grinding necessary) and didn't continue until Stage 6, around that time enemies start having two to four times as much hp and hit two to three times as hard. Before that point its pretty straightforward, bosses have a shitload of HP but they're fairly similar to how they were before. If you have trouble with the level 2 boss then just buy a whole ton of lives (same goes with the plant boss) and it should work out okay.
I think a level 50 stance song is virtually mandatory, the best one is training wheels for the last few levels, though I didn't bother getting it until the last level. Bosses drop 17 (!) mithril on DD so there's not really much grinding necessary regardless unless you're trying to get level 50 with every song. If you started out the difficulty with level 50 wheels you could probably beat the game without continuing assuming you get the "buddy" in level 6 (6-7 hours roughly). The buddy is one of the hidden trophies, after the central arrow pit fight near the middle of the level you'll come to a ladder and 2 gravestones, duck between the gravestones 6 or 7 times and he'll spawn. He randomly drops health for you, from intervals ranging between 30 second and 5 minutes, anecdotally it seems to be the most common right after you lose a life (resulting in obscenties being thrown at the little bastard); he shows up in every level except boss fights themselves until you turn off the game, then you have to go get him again. The last part of DD is the hard part so you might want to do it in separate sittings, get familiar with the first part of Chapter 6 so you don't have to waste too much time.
Chapter 7 is likely where you'll first notice your HP disappearing sans Training Wheels, the Dr. Williams can take out about 60% of your hp in a combo. Gleam dodging isn't necessarily that useful, as you still won't kill them in a single combo and the "and a half" punch will bite you in the ass. If you wind up low on HP midfight leave one guy alive and wait for your buddy to drop health, its really annoying and tedious but its better than continuing or losing a life. Absolutely do not do the bonus level as fighting 4 Abobos at once and the bullshit platforming section aren't worth the effort on this difficulty.
Chapter 8 is very similar to 7, I'll just add that you should go to the shop (ride the falling platform down with an arrow next to it) and buy a ton of lives. The Plant boss is fairly easy, the upper right and upper left corners are close to safezones and also where you'll do most of your damage. Take out the right head first as the Shark is relatively non threatening. The T-Rex head does a whole shitload of damage to 50 Balanced, 80% or so of your life, but that's where your 9 lives come in and make this fight something of a pushover.
Chapter 9 is the hardest part of the game, which might seem odd considering there isn't even a boss. However you have to ride the platform at the beginning and fight a whole bunch of enemies; you'll pretty much want to do that whole section without losing a life, we'll get to why. Normal enemies are simple enough, light light heavy > toss off the platform, spin kick if there's 3 enemies in range. Grab the bat off the Dr. Williams and try to hit the Roxy's with it, they're going to be the pain in the ass here. Falling off the platform takes off about 40% of your life, the Roxys only suicide via landing on the right side of the platform and plunging into the left, which is a huge pain to dodge. Presumably much easier with training wheels, but oh well.
Now on to the hard(er) part: Skeleton versions of enemies do not stun at all and they have about 20-25 light punches worth of HP, if said enemy has a weapon then they can break out of your punch combo and take off half your life in one hit. Just be hyper conservative here, wait for health from your buddy, stay on one side of an abyss in those fights, and use the vampiric club to heal yourself (6 club hits isn't enough to kill one skeleton, though its close) Skeleton Shinobi don't hit especially hard but they can get out of a continuous punch-lock. For the last section of the level take off Spin Kick and replace it with something that doesn't put you in the air (i.e. fireball). The wand in the center of the arena is sort of useful but again enemies have so much HP it doesn't really do much. Lots of rolling from side to side and waiting for more HP from buddy here.
Chapter 10 is not as bad as you think, but Training Wheels is virtually mandatory. You want to go into the penultimate fight with 6 or 7 lives (for explosive pots do 3 punches then roll backwards), the hardest two parts are the "blacked out" section and the two sorceror > Obobo section. For the black out try to keep the enemies away from the pillars so you can still see what they're doing. Spam the fuck out of spin kick on the Obobo and hope for the best. Since there's not that many enemies this is one of the few sections where gleaming is pretty useful. For the latter section just be hyper conservative again, the lightning strike isn't that difficult to dodge consistently and sorcs move at a very slow pace. Its your choice if you want to mess with the Obobo toe to toe, alternatively you can just wait for your magic to restore and spam more spin kicks. For the Elevator section just make sure you're not aligned with the opposite side so "Commando" Williams can't shoot you (70% of your HP with 50 balanced), the AI on ground opponents is really dumb next to gaps. I used the right side to deal with the roxys, mixture of dodge + heavy attacks and spin kicks in the corner. For the Obobos you can just sit there and wait for magic to fireball them to death, takes about 15 fireballs and 5 minutes of excitement...
On to the annoying fight. You should have 6 or 7 lives and level 50 Training Wheels, personally I also had level 50 Balanced so I swapped stances a whole bunch during this fight. The only way I've found to reliably damage Skull is spam spin kick until you run out of mana (and in my case swap stances back to TW), you can occasionally get in a few light combos on the side but 90% of my damage comes from that. Maybe another ability is useful, maybe not. Stay away from being directly in front of him so you don't get smashed by his 3 hit combo. For "Immolation" you have to hit Marian with an air heavy attack to get her out of doing the boom (50% of your HP with TW), for the teleport its actually easier than the equivalent in the first boss fight, just stick to a corner of the screen and continuously roll or jump kick away from the center. This fight is pretty random so you could probably beat it with 2 or 3 lives or just get fucked and lose with 7 and the best possible setup.
The game pulls a Metroid Prime: Echoes in that the absolute final boss fight has a continue point right before it (though the whole rest of the game doesn't), I didn't need to use this function as he seems to have about the same amount of HP he had on Dragon. The only thing I'll say here is avoid trying to damage him in his teleport phase, yes its possible to continuously gleam and get light punches but if he ever hits you you're in the doom combo and presumably lose a life (did about 80% on Dragon, didn't get hit by it on DD), just avoid his pattern attacks and get in your jump kick strings then. I don't know how the "drop HP/lives" function works in this fight, I assume its time based but it didn't happen on DD in the short amount of time it took to beat the boss.
Final setup: 50 Balanced 50 Training Wheels 50 Jump Kick 50 Fireball
Time: 11:40 (wasted about 2 hours doing achievements and what have you)
Williams: Remarkably dangerous for cannon fodder, though pretty easy to stunlock. The 1 2 combo is supposed to be the easiest thing to gleam in the game but the enemies aren't aggressive enough so you wind up missing it 20-25% of the time, not worth it unless they have a weapon. "1 2" becomes 1 and a half 2 and a half on later versions, if you gleam the first punch then the "and a half" will hit you.
Linda: The easiest enemy in the game, more HP than Williams but really easy to Gleam, just get close and wait for the high kick. If you don't want to risk it simple punch combos and throws work fine. For whips you'll have a tough time dodging, just do a light light heavy string as fast as possible. Skeleton versions with whips are a pain in the ass.
Obobo: The most bullshit enemy type, his "No/Nope" attack is incredibly hard to dodge and impossible (?) to gleam and he can use it out of any animation. I generally save magic for them and then try to gleam some of the easier attacks. Just running away until your magic refills works too.
Robots: Throw them.
Geishas: No need to rush here, calmly wait for them to do whichever animation then walk up and light light heavy, repeat once or twice. Using the fans they drop against them works well.
Shinobi: In DD this will be the first enemy you notice having a ridiculous amount of HP, though later versions of every other enemy will too. You can gleam the introduction attack and the high combo, but you're generally better off just trying to stun lock. Jump kicking in seems to work best much like most other enemies.
Roxy: This annoying flying fuck is pretty difficult to actually hit, the dodge + heavy attack seems to be the best way to damage them but unfortunately you fight them on narrow platforms a lot so it doesn't really work out. 2 level 50 spin kicks kill them, though 2 level 43's do not.
Sorcerors: Be very deliberate about damaging them, every animation they have is slow and easy to dodge; though they do have an asston of HP. Cornering them might result in getting a lightning ball in a difficult to dodge place. You almost always have weapons available for them, use them at will.