this was easily one of my favorite comic book games growing up, just barely beat it in the day too! i wanted to try Infinity War or whatever the sequel was but i hear it's balls-hard
War of the Gems was the sorta sequel that Capcom released. I don't personally think it was quite as good as X-Men MA since you didn't get the unique levels based on each character like MA gave you, but its essentially more of the same in that you have 5 characters (Cap, Iron Man, Spidey, Wolverine and Hulk) and like MA all the moves have Street Fighter style inputs. You spend most of the game fighting clones of different super heroes (heck, even Alpha Flights Puck shows up in probably his only video game appearance ever!).
Difficulty wise I honestly forget. I've finished it a couple of times, just use the power or soul gems I think? (that should make the game easier if your having problems).
Marvel game wise though I always go back to Spidey Vs the Kingpin either for the Mega Drive or Mega CD - two different versions (the CD version has several new bosses, hilariously bad FMV and a rock soundtrack for some reason, quite catchy actually). Its still my favourite Spidey game in terms of level based gameplay. The CD version also has an easier Kingpin boss fight compared to the MD version, where Kingpins weakpoint (his head) has a tiny hit box and makes the boss fight incredibly difficult since you only get one shot at it!