Why do people like hard-as-ice-tits games?

Well since you're talking about being into game design I'll ignore your main topic and just give you advice on challenge itself.
There are two types of challenge:
One is created through complex game mechanics and requires mastery of those mechanics. The second however is created by merely breaking the balance in favour of the AI.
The first brings a great feeling of satisfaction when surpassing the challenge because it's proof that you're damn good. The second however is hateful and most likely is most of the challenge you've encountered. It's cheap and annoying, and when you surpass it it's still annoying because it's often surpassed either through luck or simply doing more of the same more often. When making a game you should avoid that second type as much as possible.

For instance I'm very much into racers and the two types of challenge exist there as well. The first has the challenge being created through complex tracks with cars that require skill to drive. The second is created by manipulating AI, giving them rubber-banding (the ability to always catch up to you) and always perfect lines through corners at speeds no player can match. Where the easier modes are created by deliberately nerfing AI and making them crash in every other corner or brake every 10 meters.

Being able to create the first type of challenge, especially with multiple solutions and without resorting to the second way, separates the good and average games from the truly great ones. Especially if it can remain challenging even once mastery of the mechanics has been obtained without resorting to the second method of creating challenge.

Most of the time when people complain about a game not being hard enough they feel that the game doesn't require enough mastery of it's mechanics to beat at the highest level of difficulty. They feel that the game should still remain challenging even once the mechanics have been mastered and they want to be punished for making amateurish mistakes at that level.
Similarly the feel that the only challenge on the easier modes is actually dying because the game favours the player far too much (nerfed AI to the point of uselessness along with unrealistically over-powered player). They feel that every difficulty level should require a certain level of mastery, even easy mode.
And they're completely correct.

However I'm with you, I hate dying because these days 99/100 times that means means restarting 20 minutes away, so I play on easy most of the time and I even cheat because I like enjoying what else the game has to offer aside from the "challenge" (the story, the visuals, the little details along the way that one might miss...and I enjoy feeling untouchable, even if I haven't earned that right, I do still try to play properly though, the cheats are just there to ensure I don't get annoyed by unnecessary repetition and so that I have access to as much of the game's content as possible), in everything but racers.

Immersion, possibly.
And because a challenge once in a while is appreciated to break the habit?
Well, some people simply like challenges.

P.S.: Thanks.

I always play all games with the easiest possible difficulty.

Well, I do like challenging games, but only to some extent. When I beat the game without reloading at least several times, it just feels weird for me. But I'm not a masochist who would keep trying even after 15th attempt to complete some section in the game.
So, for me, the game needs to be hard enough not to make me fall asleep during combat, and easy enough not to make me wanna throw my monitor outta window.

Because epeen

People should know how to differentiate if the difficulty is worth it.
Old NES hard games= worth it.
Fucking smb, VVVVVV, and similar? not worth it.
I guess they bleed pixels worth it somehow.

It's all about satisfaction you get from beating a challenge.

Perfect example would be Super Hexagon. After you fail 250 times and then succeed... You can never get that feeling from a game that holds your hand.

you know why, because back in the day (im talking about mostly 90s and few years earlier and later than that) "no pain no gain" was the popular genre (not exactly a genre but im gonna call it genre anyway). most of the gamers above age 20 grow up with the "no pain no gain" philosophy and games used to be hard, i mean not todays hard, real fuckin hard, "im gonna fuck you with a cactus until you bleed to death" hard.

i remember having a notebook and a pencil on my desk to draw the maps for not to get lost ( im looking at you DOOM ) maps were complex and games were punishing, today its impossible to get lost in those stupid so called fps ( cough cod cough ) games, they are soo linear and most of the enemies are worse than stormtroopers. it doesnt entertaining at all for those gamers.

yes some are going too hardcore and masochistic on this matter, but when you die like 50 fuckin times to a boss or on some stage, when you pass it, it gives way more satisfaction than just steamrolling the whole fucking game. depends on the game but most people expects the game to challenge them.

Because the games that are soul crushingly difficult tend to let you experience the content, not force it. When was the last time you found something new or innovative on your own in CoD or any similar easy game? Games that make you really struggle through give you a sense of award and discovery when you do win.

It's human nature. It's humane to be never satisfied with what you have. That's what drives man to challenge his limits.

It's not about dying over and over again in a row on one section (well, a few games are, but IWBTG aside):

Imagine you we weren't talking about video games, but something like sports instead. Imagine you walked up to someone you know, watching or playing a sports game and said: "Why does the other team try to stop you? That's just making it harder for you to score points. Wouldn't the game be more fun for both of you if you just let each other score points instead of failing over and over because you're stopping each other?"

Sounds silly, right? People want to feel like they have accomplished something special. Like they have done something that not everyone could do. The goal of a video game is to be just challenging enough that it presents an obstacle for the player to overcome, but not so impenetrable that they become frustrated and quit. Obviously, everyone's different, so opinions differ.

I prefer hard-as-ice games with tits. In addition to the game, obviously.