I just finished the game and was looking forward to starting over at a harder setting, but I can't find my character!

I managed to get through with a few levels showing only shadows of characters and chests/boxes being completely invisible but it was still fun.

That's not normal.

I hope it fixes itself. I've heard of similar things happening in other games, but not Darkstone.

I'm pretty sure you can export and import your characters from save games and then start at higher difficulties. That may be what you want to do.