samurai shodown 4 difficulty spike

So, new to this game (been getting some good advice in gameplay so thanks to all for that) but thought i'd ask this question in general. I only have a copy on a 111 in 1 boot cart so just wanted to check, does the difficulty really spike after round 2 on a real cart too? The 111 comes set at level 8 and on some games changing the difficulty really doesn't seem to do a lot. Am going to invest in a real cart soon, as despite completely sucking at it, I quite like this game.

I have an official cart for SSIV and I find the computer fights the fairest around level 6. However as with most Samsho's the first few fights the AI Does not go all out and may let you win. After a couple rounds the AI then kicks in and tries to destroy you. I won't even talk about how ridiculous Zankuro is on any Level setting.

Why would some 111 cart have a custom hack to make a game "harder"?

And the increased difficulty you speak of is that the CPU suddenly tries to block everything. Draw the CPU in with a projectile or a whiffed special, sway, and counter attack.

Was more thinking that it might simply be broken and stuck on level 8, even when it says it's not... Probably just me sucking at it. Further practicing will be done. I'll stop asking silly questions now...