Phoenix had a pretty sweet boss fight in its own right, and I always preferred it to Demon Attack on the 2600, because it gave the game purpose and a sense of closure. Demon Attack just went on and on and on, unless you played the Intellivision or TI 99/4A versions. Those both had boss fights, but neither conversion was particularly good.

As for the difficulty dropping the further you make it into the game, you could always alleviate that by skipping the Varia suit. River City Ransom was the same way… the enemies were tough nuts to crack at the beginning, but after several hours of grinding and eating and teddy bear hugging, you became an unstoppable murder machine, capable of somersaulting your way to a surprisingly anticlimactic finale in minutes.