I noticed that the difficulty settings sometimes do not persist after you load a game.
How I reproduced this:
1.) Enter that bear cave
2.) Bear one-hits me
3.) Load at entrance of the cave
4.) Set difficulty to normal
5.) Leave Cave
6.) Re-enter cave (because the difficulty setting should get active with map transition)
7.) Quicksave
8.) Engange bear, this time he´s much easier, but still I manage to die
9.) Load last save (the one that should have normal settings)
10.) Bear is clearly much more powerful than last encounter, although the menu says it´s "normal"