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So, fighting for my forts life against a beatable threat = fun, but actually beating it (or it not being beatable) = excitement is over.
That's a good point. There does seem to be a point during gameplay where the fort is basically impregnable, and the biggest problem is the sheer weight of narrow clothing/armor clogging hauling queues and framerate collapse.
So far, one of my favorite fortresses was in a Terrifying area where two rivers cross. The river was completely filled with hippo and carp, and several ogres attacked me immediately upon embarking. I lost 3 dwarfs almost instantly - both miners and the carpenter - and having to survive with the constant threat of ogre or hippo attacks made the game fun without being impossible or unreasonable, with dwarfs having to do jobs they weren't trained for (and being careful that dwarfs had time to meet with the expedition leader, so they didn't go insane from grief). Plus there was the added bonus of watching ogres get knocked into the river by hippos and ripped to pieces by carp; every once and a while the river would suddenly flow red...
But I agree. What was exciting about this challenge was that I suddenly had to improvise and overcome difficult circumstances; had I simply modded the game to take 4 dwarfs and no miners/carpenters, I would have just been annoyed. Self-imposed challenge only works for me insofar as it makes sense to me - say, designing an entrance in a certain, insecure way, because it seems like the way dwarfs would want to build it. Nevertheless, I did embark in a Terrifying area because I was looking for a challenge, and I found one, which is certainly a point in favor of how the game works currently.
The thing about the game is, embarking in a Terrifying or Haunted area doesn't guarantee an exciting time, just like embarking in a relatively safe area can sometimes lead to freak disasters. There is so much random chance in the circumstances you will be facing, there will be exciting areas, and there will be boring ones, and there will be ones that are difficult in an unfair way. It's an unfortunate (or fortunate, if you enjoy that sort of thing) consequence of trying to emulate a "world." While I don't enjoy artificial self-imposed challenges, I will often abandon fortresses after a year or so if it seems like an uninteresting location to keep looking for a better or more fun area. It can take a few tries, but it's worth it for the moment when ogres ambush your wagon before you know what's going on (or when you find that Kobold cave, as you mentioned).