Difficulty is seen in fine distinction (8)
I believe the answer is:
nuisance
'difficulty' is the definition.
(thesaurus)
'is seen in fine distinction' is the wordplay.
'seen in' indicates putting letters inside.
'fine distinction' becomes 'nuance' (I've seen this before).
'is' put inside 'nuance' is 'NUISANCE'.
(Other definitions for nuisance that I've seen before include "Pest, pain in the neck" , "Annoying thing/person" , "Irritant or botheration" , "Annoying person/thing" , "Pest or irritation" .)