I didn't like the idea of the stuffed up heart meter on level 3 - I thought that ruined it.
Yeah level 3 and beyond was where the quest got much easier. I think what I was going for was to put the player in the kind of mindset Liberation of Hyrule does without the insane difficulty. Any hit could be your last, so tread carefully.
And once I got to Ganon and I hit him with my sword blade many times but he didn't go blue. Am I missing something?
My guess is that you're stuck on the first phase in which he doesn't turn blue (because of restrictions I had at the time). Wait for him to remain stunned for longer than usual and shoot him with your silver arrows. Be aware that the Ganon fight is really easy because of changes I made. It was a lot worse on the original IIRC (no blue ring, one heart max, moar bullets).
I don't know why you can't beat AQF and AQ - if you can beat this quest on hard mode I think you'd be pretty much up to the challenge.
See the thing is here I'm on my own playing field. I've played through this quest countless times while testing it. You don't want to see what the original balloon hill was like


