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But to answer your question - there are no "consequences". The only thing about Storyteller is that you cannot raise the difficulty back in this particular playthrough.
Yeah, which is honestly the reason why I assumed there was a consequence for choosing it, since I can’t change it back later. But if there is none, that’s good to know
There's an optional boss, only in NG+ as far as I'm aware, that cannot be fought. There is no dungeon or scenes with it, the boss is fought in the sealed book in Academia, which is open on NG+, but only outside of Storyteller mode. There WAS a glitch where, changing mode in Academia would allow you to fight it on that mode, but they patched that.
Oh, and to be blunt, the Incense is useless. They, as items, carry over to NG+ runs, but their use, like the actual stat raising, does not. None of the stat raising things carry over, sadly. Gear and items do, so you do get a lot of power for a second and later run, as do the levels, if not the unlocking, of the Archetypes.
Absolute agreement there. I have a save file for Ys VIII with all characters with 9999 in all three stats, as well as HP. I have still played it twice since that save was made because it's an awesome game.
I do get WHY they did it, as it allows moments in the game to still have impact and power, as while equipment IS a lot of your power, those stats and levels not carrying over keep you from being OP and destroying everything. It makes a battle through the hardest difficulty actually difficult and you have to plan your tactics against it, rather than just being able to come in with a maxed out party to curb stomp it.
How the f do you want to min/max everything but at the same time fail to beat enemies at the easiest difficulty!?
Edit: Also, afaik, enemies respawn in dungeons so you COULD technically max out the classes and characters you got so far, although that might take literally weeks because of diminishing XP returns...