Seb Downie, the QA manager at Guerilla Games explains the four difficulties in Killzone 2, over at the SCEA forums;
The difficulty system is not based on enemy counts, but more on damage modifiers and health. The health of you, your buddies and the various enemy types and the damage that all of you deal out. As the difficulty goes up, your ability to Run n Gun goes down. Youll be spending more and more time ducking from cover and recharging. It becomes a lot more tactical and needs a bit more brainpower as you go up. The lower difficulty settings is more for folks who like to storm into rooms, guns blazing. Do that on the harder difficulties and youll get more than a black eye.
Recruit
Let your girlfriend play this one, or your mom. Anyone caught playing this for any other reason than seeing if he can get through it blind-folded needs a open-handed slap.
Trooper
If you are new to FPSs, or havent played one since Doom, then you might want to start here. Will provide a challenge in places.
Veteran
Now were talking. This is your first playthrough. Hop to it soldier.
Elite
(unlocked by completing the game once on any difficulty)
We up the anty a bit and remove your HUD and crosshair. Try that on for size, but dont come crying to me if the big bad men with the orange goggles take you out back for a proper slapping.