Grizzleheim is a parallel world to the current worlds on the Spiral.
Each area of Grizzleheim is on par with the individual worlds of the Spiral. The first areas of Grizzleheim are similar to Wizard City in difficulty and in reward. As you progress through Grizzleheim, the creatures get more difficult and the rewards reflect that difficulty.
My days at GrizzleHeim was fun. But I was tired of getting bad exp and bad rewards. I should say that you should fight bosses at GrizzleHeim to get lots of exp and lots of good drops