Today, the City Watch (hard mode) and low level invasion battles were more difficult then I expected.
R18 for City Watch, Y6 for Invasion.
Most of my heroes average R0-R3, with a few at R10 and only 3 at R18-19.
Since I lack the stamina to do multiple character upgrades and Yellow Badge Crafting is currently inaccessible to me, I am concerned that the enemies are slowly approaching the power level where my teams will be completely incapable of defeating them.
Just keep on raising YOUR heroes.
Start hoarding Free Stamina until you can upgrade your heroes.
I recommend focusing only on 5-15 characters as then you have the most chance of getting through content as your resources are focused on your mains :-).
In the case of mains, one do have to sometimes switch out old mains for new mains, but that means sticking to the new main and making sure they getting up to the level and rank as your other mains.
As far as Power Creep goes, Power Creep has actually seemed to slow down a bit lately, so characters aren’t as rapidly power increased. While of course there are still going to be a huge difference between old characters who haven’t gotten refreshed/buffed recently and new characters, so one eventually likely have to invest in some new characters.
this is what’s causing the issue - CW is scaled on your top 5, so those 3 R18-19 will be skewing the enemy power beyond what most of your heroes can easily defeat.
Same with invasion - it’s scaled on your Team Level, which is presumably equivalent to R18-19.
It’s better for these modes to try to keep around 15 heroes quite evenly matched than just a few stronger ones, as that gives you much more choice of playable heroes
Raised Ariel and Sisu up to R10, ended up with 0 stamina and I had a lot of it saved! 
I’m trying not to think about what it would cost me to raise up my top 19 to R19 or whatever the non-yellow cap is.
I guess City Watch makes sense given those conditions, but Invasion is completely incomprehensible.
I definitely don’t have any heroes at Y6!!!
Out of curiosity, surge is scaled on?
Team Power (top 5) of each guild member, scaled from lowest to highest using some sort of multiplier, then advanced by 1 level per surge wave