Well, the Gears 1/2 campaigns are a bit on the easy side, but it never really felt like it was due to hp regen. Having medpacks inserted randomly along the maps wouldn't have really added much to the gameplay. The balancing would have to be changed significantly, anyway. Having hp regen would mean that your maximum total hp would generally be a lot less than it would in a game where you need to rely on medpacks (as a general rule - there are still the games where hp doesn't regen, but where you also have very little hp to begin with - in which case, medpacks add little; a more 'realistic' approach).
In Gears, you take potshots and shrug them off, but if you take a good spray of good bullets, you'll usually be near death. You can rest a bit and recover, but you need to get yourself out of harm's way or you're dead very soon. If the game had medpacks, it wouldn't work in the same way. Either you'd have a lot more base hp, or there'd be a lot of medpacks lying around anyway. Of course, there are ways in which it could be designed differently; as a quick example, no medpacks, no usual health regen, and you only get your health back at every checkpoint. Thus, every battle becomes a struggle for survival. You don't recover by hiding, and you don't need to look around for medpacks. The designers can also design each battle to be as challenging as they want it to be, knowing that the player *starts* off the battle at full health. It's less about surviving the entire game and more about surviving individual battles; completely different approaches, though in this case the devs can probably afford to make individual battles *harder*. Different challenges and all.
Gears campaign is easy. The Gears system itself doesn't inherently make the game easy. In Gears2, there's a 5-player co-op mode where the team is put up against waves of increasingly difficulty enemy waves. It starts off easy enough, but as enemy types become harder, or their hp/damage output/accuracy increases as the wave number increases, things become pretty challenging pretty fast. Since you're often put against overwhelming odds, and your positions are often overran from multiple flanks, it quickly becomes a game of setting up defensive perimeters (deploying portable shields, proximity grenades, setting up mortars and heavy MG positions), coordinating flanking maneuvers, pulling off retreats when you need to. Essentially, the game overwhelms you with enemies; it's constant high action stuff. Would hp + medpacks really add to the challenge? Can't say it would. Sure, health could be treated as an additional resource that you'd need to keep an eye on (and medpack runs would be something else that'd be important). On the other hand, given the current balance of the system, they'd also have to give you significant more base hp (as in, actual balance, rather than 'lol I beat DX without upgrades or medkits or weapons'). The thing is, with hp regen, the devs can afford to put you in near death status whenever you're exposed for more than a split-second. They wouldn't be able to do that with a conventional hp system (without sucking the gameplay out of it, anyway). It's a completely different focus, and the game still remains extremely challenging.
But yeah, I beat DX without weapons or upgrades or medpacks anyway lol.