Hehe, if you think things are hopeless, things ACTUALLY feel hopeless around 7/7. At 10/10, I'm pretty sure the AI spends half the time telling you to not even try, and the other half of the time eating your face for breakfast.
Not really.
Once you figure things out (and there is a lot to figure out), 7/7 is where people are expected to find a fun game that is difficult enough that they find a challenge while being easy enough that they should win.
Below difficulty 7 the AI is given disadvantages (has some game options removed, has its decision tree limited so it makes 'stupid' moves, etc.)
Above difficulty 7 (so 7.3 and higher) the AI gets bonus ships on everything it does and so is more difficult that way.
In other words, difficulty 7 is the sweet spot where the AI is not hampered in any way so you are facing its full range of abilities, but the AI is not receiving any bonuses in its attacks against you either.
Having said that, do work your way up to 7, there is a
lot to learn and while you can afford to make small mistakes against difficulty 7, making a large mistake can easily cost you the game as the AI does not pull punches at that level.
Do be sure to keep posting any questions you have, I absolutely love this game (I've been playing since before the first expansion pack came out) and I hope you will enjoy it as much as I have.
D.