To me that's the opposite of challenging. That's just lazy design. Challenging means, this is the fight, you're level 20, beat it with tactics. But in grinding jRPGs almost all challenges can be overcome by just grinding. See a boss? lose? ok no problem, let me kill 100 more lemmings while I sip some tea. Fight boss after that, you one-shot it.
It's not that I don't like levels or exp, I LOVE it, I like RPGs mostly because I can see my character/group grow in power over time, but not by running in circles around a save point fighting easy fights to get levels. A perfect example, Gladius (my favorite game of all time). You fight, you gain experience, but there are no random fights (mostly), you beat your arena battles with different enemies, different restrictions, etc. What members you chose to fight, positioning of troops and tactics during battles is a hell of a lot more important than 'being level 50'. There are many other jRPGs that you can win without grinding, I just wish they were the norm and not the exception.