If the success of the Dark Souls series is indicative of anything about our current generation of gamers, it proves that people enjoy challenges. Higher difficulties are enjoyable, and having to think and play safe can make any video game that much more intense. Instead of making the computer AIs smarter or more reactive, some developers opt to just turn them into "bullet sponges."
A "bullet sponge" refers to a character who soaks up bullets. In most games, increasing the difficult doesn't make the AI play smarter, it just means you'll have to take a longer time killing the enemy.
The best example right now is Fallout 4. I'm a huge fan of the series, but one of my biggest gripes with the game was how increasing the difficulty only increased a monster's health. All monsters fought the same, regardless of difficulty. They didn't suddenly engage in strange and unorthodox tactics. They were just able to withstand more bullets.
Developers need to understand that sometimes a smarter or more reactive AI is more challenging than simply giving them more health.
Veteran difficulty in COD is an example of a better alternative to "bullet sponges."
In the Call of Duty games, the highest difficulty mode, veteran, made it so that players would die in fewer hits. It did not make it so that enemies could take more damage, it simply made the game more realistic. Enemies would chuck grenades and make full use of their cover and position.
This is a great alternative to "bullet sponges." I'd be a happier gamer getting instantly killed by an enemy than spending ten minutes punching rounds into a "bullet sponge."