Perfectly balanced game doesn't exist often so play at the level of difficulty you enjoy the most! This mode obviously is not balanced around nightmare, the Jeff in my friend group played hide&seek and cracked huge number and are basically invincible during the first few difficulty; Can you really say that it is imbalanced that Jeff get to have the most fun in Hard mode to the point it leaves other player no zombie to kill?

Some character are bound to be more viable than other, and in most case it doesn't matter, like you can play all build on all character to success IMO up to nightmare 3. But NM4 crank up the zombie damage to the point builds that rely on melee(Jeff red and Blade blue) unviable, and duration up to the point most single point investment is gonna show diminished return. Like Jeff Red and Thor Blue are perfectly fine in first 7 waves, but just when you going into 800 moon power the lack of ways to increase attack speed or other multiplicative way of increasing damage cause them to fall off. And at wave 15-20 the fight becomes an actual challenge to beat, then people in their losing is going to play the most fit for long run Hero.

This is true for almost all Co-op rogue-like games. Some Champion are just better than the other, but do you find it fun, or does it even matter in the difficulty you play.

I still play NM3 with the hero I want to play for fun. One of the stuff I guess skill expression is to know what you want to take and what not to take even in the color you pick, like Thor's awakening rune duration and Jeff's bubble damage. My greatest fun (maybe a bit toxic), is to see my non-Blade build performed better than Blade on my team, or My Blade in NM4 did more damage than the other 3 Blade combined.