I think a lot of the issue here is really about immersion or verisimilitude or whatever version of that you want to call it. If the game includes side quests you can do that get you better stuff and more power and that therefore make the challenging parts easier (at the cost of taking longer), then it maintains the immersion because you had an in-game solution to the difficulty issue. As long as the side quests are still fun, the game can then be fun for many types of player. I assume Tom would have no issue with this sort of approach.
If instead, the game gives you the option of purchasing better stuff and more power, most people would have an issue with that. Is the issue only the monetary cost, though? If I made a game that was incredibly difficult but free, and then sold powerful items that reduced the difficulty (by upping your armor or damage or whatever), that could still be fun, as long as there was some trade off to which items to buy and the cost wasn’t outlandish, but you would lose the immersion of any in-game item earning.
Take exactly that game and make all the items free (but then charge a purchase fee for the game itself) and you’d have something like the LCG vs CCG style of card game. Still potentially fun, because of the combinatorics. But the issue then is that the menu isn’t like playing a CCG or even something like the MOO2 or CK3 character creators. You don’t choose your build from a set of trade offs, and you aren’t locked in while playing. It’s like the Diablo 3 skills, if the only thing the rune choices did was increase your damage and resists across the board. And it feels like an external manipulation to boot, so it ruins the immersion of skill choices.
It’s similar in this way to the question of having a “hardcore” mode with permadeath. You don’t have to include a mode where one death means your saved game is deleted. People could choose to just start over when they die. But it feels wrong or unfun to make that choice for yourself when the game gives the option to respawn.
There’s a related idea that I think also comes up - the consequences of moral choices. So, a game like Heavy Rain, where you can let you son beat you at fencing early on or you can whoop him. There’s no incentive to either choice, but it still feels like a gameplay choice even though one is a little easier to do. Similarly, a game that has situations where you can slaughter a bunch of people, many of whom will eventually become enemies, or choose to let them go. If letting them go means that you have to face a stronger force later and so the game is just harder, it feels like the game is incentivizing bad actions while providing no incentive for good actions. It doesn’t feel quite right as a customization option, a gameplay decision, or a moral dilemma because it isn’t fully developed - it doesn’t flow naturally within the world because the world isn’t rich enough to model the good opinion or religious reason you might choose the higher difficulty of the moral path.