The main difference between normal & hard is that on normal the AI is more likely to bluff/play bad cards, and is easier to scare off pots when it has a hand (ie more likely to fold to a raise even though it has good cards).
Beyond that, we are talking about degrees. Ill spare you the boring details, but every AI decision runs through a tree, with weights based on its skill level. The smarter the AI, the better decisions it will generally make. But nobody is perfect, and in poker even good decisions can have bad results. Also, each player has slightly different play styles, so even on Hard mode, Max is wild and unpredictable.
I know some people won't believe me, but I took care to make sure that the AI never cheats, and never takes advantage of the "God's Eye" - the fact that the program knows everyones cards at any given time. If you are getting bad beats, that's just poker. If it makes you feel any better, I played 9 times on hard before I won my first tournament, losing some on some horrible luck!