I regret to inform everyone that after taking numbers along the way to peak 10 we can conclude the system is working and what/how much it actually does.
TL:DR Looks like Peak levels are equivalent to about half a normal level.
Example- Peak 5= lv102.5 Peak 10= level 105 Peak 20= level 110
Here's the evidence
A number of conclusions can be made with this data the biggest imo being the resemblance to what accuracy would be like if these were indeed half or quarter levels.
The second biggest showing how much adding the raw accuracy stat actually helps, 900 accuracy made the difference from P9-10.
Posting this as many people, myself included, were thinking the system was basically broken and not really doing anything but as you can see it does work. It makes me really mad that they released this hardmode instance with MAX level 5 KNOWING we had zero chance and didn't even state that we weren't supposed to be able to do it yet...