One thing you might think about here is looking at more strategy-oriented games like Civ, Starcraft and roguelikes such as Nethack and Crawl. In these games, game difficulty and player progression are not simple single-variable functions. The gameplay evolves over the course of the game.
In the early-game the goal of the player is to simply survive, progress, increase in level, get the next equipment with a +1 bonus, etc. Generally everything the player finds is better than what they currently have - whether that's a new fishing spot in Civ, or a new sword in Nethack.
The mid-game often features the player exploring the environment for gameplay options. Now, maybe they're setting up strategic forts, or collecting equipment with special effects that have situational uses, but still simply trying to survive to accumulate more stuff.
The late-game forces the player into a showdown, usually with the toughest opponents, but also with the most options at their disposal. More experienced at playing the game, now not only must the player survive, but also exploit the effective weaknesses of their opponents with the tools they've discovered and refined from mid-game forward.
You can see the same progression in Final Fantasy games - in the early game, most enemies can be killed with a simple attack, and maybe a couple healing spells as needed. Mid-game enemies begin to appear that are more difficult, but with obvious elemental or status weaknesses to exploit. Late in the game, the enemies might be practically unbeatable except for clear well-thought-out strategies based on less obvious weaknesses or AI script.
- Early game: Survival. Resource collection.
- Mid-game: Exploring the environment. Strategy building.
- Late-game: Strategy execution. Exploiting resource options.
It doesn't HAVE to be this way, but I've seen the pattern in many games from console RPGs to PC strategy games, and even handheld tower defense games.
In a game like Oblivion, the difficulty is that the player has to make choices in the strategy building in the early- and mid-game by choosing how to level up that can have drastic consequences late-game because there's no option to change that strategy later. It's how you've built your character. The same is true in Diablo 2, and many other games that allow you to select skills for your character without the ability to change them later on. A skill-based character advancement thus takes a bit more fore-thought into how individual skills can be used to build a cohesive strategy. In Diablo 2 you can see how the developers struggled with it by looking at how often they tweaked the skills over the lifetime of the game. It's easy for an inexperienced player to reach a point where their permanent strategy choices are no longer effective against the opponents they're facing. That doesn't necessarily make the game unbalanced - it simply turns the skill progression choices into part of the player's strategy, and may require several playthroughs to develop an optimal strategy.