Hey thanks for your interest in the mod, and I am glad you are enjoying it.
Basically I made it so that instead of waiting until ~Cosmo Canyon to make enemies a threat, I started things off fairly easy and getting your party into a stable place, and then boosted the enemies starting near the Train Graveyard. As you make your way through Mid gar, the difficulty/balance will level off a bit. After you leave Midgar, you and your enemies will develop at a gradual pace - allowing you to deal massive damage when you're strategy is optimal, and allowing enemies to pose a real threat if it is not. Some of the bosses can be a threat, and some rare random encounters too; but if you maintain your equipment and materia allocation regularly and remember not to neglect different characters' strengths, you will always have the advantage. For some extra challenge, keep your level low, and diversify your party. I've allowed for the exploitation of particular stats. If you want to make Cloud super strong and cast lucky strike on him, go ahead, if you want to make Aeris have super high mag, and use the most powerful spells, that is fine. If you want things to be interesting, then you will play around with the characters, new spells, and new equipment until you find a combination that makes you feel good when you play. That is why FFVII Lost Wing was made; to allow the player to utilize his/her characters the way he/she wants to. If you grind and strive for optimization, this won't be very difficult, but if you go with the flow, and play for your own tastes, this will be a fun and moderately challenging mod.