I can't say for sure that the game upscales challenges to the party level, but if you got you ass handed to you at level 11, i'm quite confident that you have issues within your party (e.g. tactics, party composition, gear, etc) you should address before adventuring forth.
I went in at level 6 and everything was "sort of" smooth till the last fanpyr (i'm trying to stay vague for spoiler's sake) and i can't go through because his friends like to spam an aoe effect even in the midst of their allies, which harms both ours and theirs (that's where "cannon fodder" is being taken from :v ). rumours suggest that this is meant to be this hard because you need to progress through the main quest in order to ease the encounter, but other rumours suggest that you can actually clear that content, even at level 6, and receive a really nice item which is worth the fuss. Can't say both statements are speculation, can't say they're not. What i can say is that i've now moved on and will go back in in a couple of levels