The controls definitely do get a little sticky around level 7. I found that the best solution was to tap the space bar as quickly as possible -- you jump the same height regardless of how long you hold down the space bar, so if you let it go immediately, it seems to improve the chance of the game registering your next press.
So...the townspeople are so weak that they need your help against enemies you can easily defeat at Level 1, and yet they still charge you outrageous prices for weapons and items. Hmm, seems like there's a flaw in this logic somewhere...
Everyone -- to recover your save data, go to the place where your Flash shared objects are stored (see the forum thread if you need help with that), go to chat.kongregate.com/gamez/0009/5626/live, and copy the contents of the hc.swf folder into hc__11_.swf. To the developer: please don't change the name of the .swf file when you upload a new version, because it causes everyone to lose their save files like this.
Everyone complaining about the Contra code: please look up "Konami code"; it's even in wikipedia. That is what you need to enter. Things like "contra" work because you've already hit the arrows and the "b", but that's only a coincidence.
Suggestion: Rather than having the easy/hero difficulty selectors be things that really, really look like buttons but aren't, it would be better to have something like a giant arrow saying "fly HERE for easy difficulty!" pointing to the not-a-button.