-You can't go back to previous levels (Thus making life vials from heroes useful). -Stolen weapons are lost ( I predict a lot of resets on hilltop mausoleum). -More damage from enemies (Like a permanent helmet). -Less Money Drops.
Maybe more vials before the battle against zarok's army to balance the game.
I'd also like a speedrun like mode. You have a limited amount of time to finish the game, only 1 or 2 saves.
I'd allow levels to be replayed personally, but I'd take the drying out of fountains from 2 to make replaying them less rewarding in terms of healing up. If you wanted it really hardcore, you could have all life bottles empty to begin with (like the first one is in the Japanese version).
To balance things out, I'd allow purchasing Life Vials from Merchant Gargoyles.