The best thing I like about it apart from general difficulty increase is that it will give game mechanics such as deflections, parry timings, dodge Iframes and most importantly prosthetic tools a whole new meaning. You are now supposed to utilise everything available in the arsenal. I myself came up with so many different prosthetic strats to deal with enemies/bosses.

For those who say that the game was intented to play charmless, you are wrong.
Difficulty in videogames is complex. For a given videogame with a good combat system as well as a good storyline, if you play it on easy mode maybe you can enjoy the story but you gloss over the combat, repeating the same strategy or moves over and over without appreciating it and it tends to become repetitive ; if you play on a harder mode, maybe you do explore some more of the options the game gives to you and there is a sense of accomplishment in mastering the mechanics, but sometimes that extra difficulty is just too much and nonsensical, and as the guy below stated, harder doesn't mean funnier.
I like the aproach that is taken on souls games and some others, including Sekiro, by having a fixed difficuty. They are telling you from the beggining that that's the way the game is meant to be played, and also, that's the way they try to achieve balance between gameplay and storyline.
The combat in sekiro, in my opinion, is just beautiful, and it does feel good to become good at it, and the only way to do it is by dying over and over, but on your first playthrough the game doesn't allow you to play charmless and that is for a reason. It is not an easy game, despite of what some no life brats like to say, but there is a huge different after a couple hours. At first i use to feel overwhelmed by almost every mob, specially the fat dudes with hammers, but now i can defeat most bosses without taking damage by deflecting and that is gorgeous, but to get there i died A LOT. Here is when the demon bell and the charm come in, because at this point, when you have mastered the game the additional challenge is appropiate and pushes your limits even further, it does change your playstyle, maybe now you have to use the consumables you forgot about on your first playthrough, maybe you should try different prosthetics when facing some foes... is somewhat a new experience, but is easy to get frustrated. Some mobs can easily one shot you just for a silly mistake or a bad camera angle, or if you fight a new boss that you didn't face before, for example because you are doing a different ending (shura ending, in my case), the part of learning his moveset takes much more time since you die with almost every of his moves, and you have no clue of what he is capable of, so if you were to die on a normal game like 4 or 6 times or whatever until you do an actual attempt, on a charmless game with the demon bell maybe those 4 deaths become 20. On the other hand, piercing attacks don't make sense anymore because every single one is a piercing attack. You are clearly inferior compared to your enemies in terms of strength without any context, and that's why the game allows you to turn back to a normal game if you want by giving you back the charm, or dispelling the demon bell, because maybe it is too much and they can make the game not fun for you anymore, so, no, charmless is not the way the game was meant to be played at first.
If you like the challenge, you enjoy the combat system (and you have mastered it at least in part) and are a bit of a masochist, like me, maybe you should give it a go, not even on your second game, maybe on the third or fourth, but not before. Play as you like, the game is awesome so it's up to you (sorry for my english, i'm still learning).

A harder mode doesn't always make the game more enjoyable

After playing the game on charmless for so long, I feel like the game was originally designed to be played charmless. I feel like the base game doesnt incentivize deflecting perfectly enough. Sure your posture gets hit more but that doesnt mean much when you could just back off and regain it in 3 seconds.

My observation on Kuro's charm(ng+4): not having it in the inventory definitely effects the enemy ai. Most noticeable were the story boss enemies. During Genichiro silver field or tower fight he would perform uncommon attacks frequently like that over head with perilous thrust. In Gyoubu phase2 he was entirely melee oriented and would never run away giving us chance to grapple confirmed after replaying it in reflection of strength. I also found ashina soldiers(hat) to be much offensive and even the nightjars who take big pauses between offense were attacking me non stop. I really want someone else to confirm my observation.

So in lore point of view not having kuro's charm which would be the physical reality of Wolf, not only enemies are stronger but Wolf himself is very weak? Enemies don't take chip damage when blocking but wolf does. Sabimaru takes ages to poison enemies while wolf gets poisoned in seconds. Wolf's vitality and posture is so less he's also near physically challenged among all enemies and bosses. "Skilled shinobi"? My a**.

So you're saying.
Easy difficulty=no bell demon, kuro's charm
Normal difficulty=bell demon
Hard(or nightmare) difficulty=bell demon, no kuro's charm.

GULPING INTENSIFIES

So are you able to remove the charm at any point in the story, or do you absolutely have to do it at the beginning?

Sekiro is my first FromSoftware game. Got my a•• kicked like never in a game ! Got the platinum trophy and the game really revealed itself after I gave the charm back ! Deflecting becomes so satisfying and not a L1 spam ! The game should be like that at first with increasing chip damages through the NG+s.

I'm all for playing without the charm, cause I love the challenge. But it bothers me that without charm the umbrella prosthetic loses some of its utility. I just wish the umbrella wouldn't take chip damage, cause one of the cool things the umbrella does is to store "energy" and then release it (provided you have the skill). Without the charm that's hardly viable unfortunately