A few observations from my day of RPGing:
The levels on the monsters need some serious tweaking. Most monsters are far more powerful than their current level indicates. The Wraith is less dangeous than the supposedly lower level Orc. And being level 20 (and fully decked out except for a single righteousness enchantment on my helm) , I'd still get wiped out by a Dragon, let alone anything tougher, in fact I have only slightly better than a 50/50 chance against a Troll, I think.
There is no reason to fight anything other than the Wraith or the Kobold. The Kobold when you are to weak to fight the Wraith, and the Wraith because everything else is more dangeorus than the Wraith but gives less gold or is sufficiently more dangerous that the slightly higher level of gold is insignificant compensation.
For the cost of fully healing 13 times I can buy Dwarven Full Plate of Rightenousness, which whill hold off needing to heal a hecka lot.
Also Attack boost items like the great sword are serious overpriced compared to an equivalent defensive item.