The plot thickens. I had the difficulty set to easy for low effort farming, so I set it to the hardest difficulty to compare. (Abandoned the hopeless attempt with the AI doing 0:57 laps). And what happens.... The AI is now lapping just over a minute. 1:00.172 FL in lap 33. The AI is keeping 12 to 14 sec ahead of me, matching my pace. So far I'm matching their pit stops, don't want to trigger their catch up boost if I jump them while they are in the pit. I'm in 3rd behind the two Japanese drivers.
So the difficulty slider does work, but like most other things PD does, it works backwards
Aptly labeled the human comedy.
Edit: done deal. Easy victory after setting the difficulty to hardest
The big rain came at the end, I followed the AI in for IM. Then after a while it started raining really hard, they pitted for heavy wets, I stayed on IM. IM are fine up to 220 kph in heavy rain, since you don't go faster at Tsukaba anyway... With them on Wets and me on IM I was still increasing the gap on them after jumping them in the pit. Then when the rain stops the AI cycles back to IM first, then on to Softs a couple laps later. I stuck it out on IM and changed for fuel and RM when the dry line was dry enough. 55 laps completed, half a lap ahead at the end while crashing earlier and taking too many pit stops.
The AI set the FL in the end at 59.9. I never got a lap in under 1:00. I could try with my tuned version now but no more credits to get. Nice that the prizes all add together, 1.2 mil total.