1. It determines what kind of environment you'll be playing in and what kind of random events you might face during the mission. So, when you ramp up the difficulty, expect more moving ice chunks, sessile organisms that disrupt your sonar, volcanic activity, water currents and more frequent (and more dangerous) monster spawns.
2. Sort of. The seed determines the layout, size, biome, mineral spawns and the locations and layouts of the alien ruins. It's not possible to directly choose these properties using the seed, but when you use the same seed, you always get the same level.
3. Unfortunately no, although turning the difficulty up generally tends to generate longer levels.
We will most likely add some more detailed level settings to the multiplayer though, for example I think being able to choose the biome directly would be a really useful addition.
Also, if you're interested in modding the game, it's fairly easy to modify the way the levels are genera...
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