Information gets passed along through gameplay.
This information, in my experience, tends to be insufficient. If the DM really just plops down a random encounter without thought, even if he describes what's in it, the players won't know whether they can deal with it.
The problem is, you really
need to know the levels of the opponents you're facing in order to estimate the difficulty of an encounter. And that's just a starting point, you'd obviously need to know whether there's any solo's and elites, and perhaps even information about the strengths and weaknesses of the opponent.
See, when you describe the local warlord as a pretty serious threat, with a record of nasty gladiatorial combat - what level would he be? Is he 15th level? 4th level? 10th? It's really hard to say based on that description. 4e
commonly has monster types that come in a whole variety of levels. Similar monsters, all sounding nasty and threatening, just one of em is 10 levels higher. That kind of level distinction is truly an
execution when the PC's misjudge. Is a
Stormstone Fury more dangerous than a
Fell Taint Pulsar - and how would the PCs tell the difference?
The DM has three options.
- He can ensure that all combats are level-appropriate and that the rare overwhelming encounter is clearly warned against (read: drop obvious hints that that Adult Red Dragon there could roast you all alive).
- He can describe the difficulty of encounters in-game, but will need to describe difficulty relative to the PCs. This is a bit awkward, because it really makes no sense that the villagers describing their tyrannical warlord (who's probably overwhelming to them) would speak of him as a hard but defeatable. It becomes even less reasonable once you include info about group size and composition. The warlord and a few minions may be doable, but the warlord, a few skirmishers and a soldier may not be; D&D combat is fairly precisely balanced, levels vary wildly, but just going 1 or 2 encounter level up can turn a hard encounter into a laughable unbeatable one.
- He can in some fashion reveal the game-mechanical strength of the enemies; or at least indicate overall strength. This is weird narratively, and though I think I'd like to use this approach, I don't know how you'd do this. How do the player's judge an opponents level? What's the in-game motivation?
Think of it like rankings in team sports: if you just describe players as "fast and a good team player" and another as "great technically, with a strong XYZ", its really hard to guess the outcome of a match between two teams. On the other hand, if you know in which league of play a team is in and their rank within that, you've got a pretty good indication - teams from differing leagues are liable to outclass each other. It's that kind of information which is hard to describe qualitatively. D&D has a vast diversity of ability, far broader than that of "real life" - yet, we hope that PCs can judge the difficulty of encounters using inexact qualitative terms that aren't even sufficiently precise in "real life".