I made it to T3 in Spiral knights a week ago or so and have been grinding pretty steadily onward. Unfortunately I still only have one five star piece of equipment. The rest of my gear is currently leveling still, plus the 25K (if you are lucky and can buy from Basil) or the ~32-35K from the AH puts a big dent into the pocket book real fast. I'm not even trying to make myself look spiffy yet, just functional (Plus I look pretty spiffy as is).
I have tried a few Vanaduke a few times, but usually the group falls apart without ever actually getting there. The one time I did manage to see the big baddy, the battlefield was horribly bugged graphically for me and I kept running through invisible fires all over the ground, which didn't help at all. there is an arena on the stage before the Duke, that has numerous traps, three Trojans (horse people), and 15-25 fairly robust zombies, and that arena does a good job of breaking most groups. I tend to fair decently because I have an undead slaying sword, and full fire protection base gear, but it still is painful if you are charged by the three horses at once.
I will say one negative thing though for T3 right now though. it seems as though Vanaduke is the only gate that ever has an active party on it usually, as if most people don't even bother with T3. As such, I have not ever actually sen the core yet, which is a bit of a downer. I do hope it is at least somewhat worth it, but I have my doubts.
So T3 definitely shows a grind forming in the game, nothing worse then what I have put up with in the past, but a grind none the less that some people might get turned off about. The more money you have to grind, the more energy you have to burn, the more energy you burn the more money you have to spend to rebuild that energy.. So the circle is painful to those not expecting it. I think the price is a bit to much for the recipes from the vendor, when combined with the price and energy cost needed to actually craft the item, but that is just me, and I am never a huge fan of crafting so there is a bit of bias.
In terms of cash flow, T3 is the place to be, as the income rate is relatively high. I find that heat though rather sucks in T3, and still better off doing Jelly king runs for heat. It's weird, but I guess since you are supposed to be at 'end game', the heat ratio is supposed to be low. I have been doing T1-T2 jelly runs solo to maximize heat and crown income, it isn't terrible, but does certainly get boring after a while.
The game overall is still fun to play no doubt about it. Things just got a lot slower once I hit T3, and I think some folks might be taken back by that assuming they managed to get to T2 quickly. Push on, and the game can still be fun, but just be ready for those rough spots.