The description for Confidence (CRB pg 133) states that "If the character decreases difficulty to zero, he does not have to make a Discipline check." What about if there is a difficulty upgrade and one of the purples is a red? Does confidence downgrade the red if there are no purples? Or not?

Short answer, it will downgrade the red to a purple. This would follow the general upgrade/downgrade rules that are in chapter 1 of the CRB.

But the Confidence talent "decreases difficulty," it doesn't downgrade. If you had two reds and a purple difficulty, and three levels of confidence, I assume you would be at difficulty zero.

Increase/decrease the base difficulty, then upgrade, then downgrade.

Difficulty 3 with Confidence 3 would drop to a starting Difficulty 0, but with two upgrades it would add a purple, then convert a purple to a red.

But the Confidence talent "decreases difficulty," it doesn't downgrade. If you had two reds and a purple difficulty, and three levels of confidence, I assume you would be at difficulty zero.

Not per the rules mentioned in Aahzmandius_Karrde post. you remove purples till it runs out of purples then it downgrades them to a purple then removes that purple and so on till it reaches 0

Challenge dice (the red ones) can only be downgraded, not decreased. So if you have one Challenge die remaining and need to decrease it, you can't. Decreasing only removes Difficulty dice (the purple ones).

I concur with HappyDaze.

The steps listed under Modifying a Dice Pool are:

1. Assemble the Basic Pool
2. Add Dice (only talks about Boost and Setback)
3. Upgrade Dice
4. Downgrade Dice
5. Remove Dice (only talks about Boost and Setback)

The confusion is that in "Applying Task Difficulty" the sections mentions upgrading to Challenge dice, which should not happen until Step 3. The section states that "After setting the difficulty level for the task, the GM adds the corresponding number of Difficulty dice (emphasis added) to the action's dice pool."

The question is whether or not talents that reduce difficulty occur in step 1 or step 5. I consider it part of the Applying Task Difficulty, which affects step 1. I think this is reasonable also considering there is no explicit mention of if Challenge dice can or cannot be removed.

Following the example HappyDaze mentioned above with a step-by-step explanation:

1. Assemble the Basic Pool: Difficulty 3 Fear Check, 3 Ranks of Confidence talent reduces the difficulty of zero. PC adds Ability/Proficiency dice depending on Willpower/Discpline.
2. Add Dice: nothing added.
3. Upgrade Dice: the DM upgrades the dice once because the adversary rolled 3 advantage on a previous check, and again beacuse he spends a Destiny Point (he's a real jerk). First upgrade adds a Difficulty die, second upgrade replaces it with a Challenge die.
4. Downgrade Dice: nothing downgraded.
5. Remove Dice: nothing removed.

Final result: PC dice pool vs. 1 Challenge die.

If you wanted to really rules lawyer it, the upgrade is actually irrelevant. To use the example above, the end of step one, the difficulty is 0. According to the talent, if the difficulty is reduced to 0, the character does not make a Discipline check. Thus, even if it would eventually be upgraded, the check has already been nullified by the talent.

If you wanted to really rules lawyer it, the upgrade is actually irrelevant. To use the example above, the end of step one, the difficulty is 0. According to the talent, if the difficulty is reduced to 0, the character does not make a Discipline check. Thus, even if it would eventually be upgraded, the check has already been nullified by the talent.

I suppose you're right there. I was mainly running through the process for my own benefit since it could apply to the Unmatched Expertise signature ability. With enough XP invested, it could have the ability to reduce the difficulty of a check to simple.

If you wanted to really rules lawyer it, the upgrade is actually irrelevant. To use the example above, the end of step one, the difficulty is 0. According to the talent, if the difficulty is reduced to 0, the character does not make a Discipline check. Thus, even if it would eventually be upgraded, the check has already been nullified by the talent.

I think the talent "checks" after all is said and done. So, if you have a PPR (1 upgrade) and reduce the difficulty by 3, you go PPR-->PR-->R-->0-->P as you reduce difficulty and then re-apply the upgrade you've essentially ignored during this process, leaving you with a difficulty of 1.

Considering how limited Fear really is and how seldom Confidence actually gets used, would it really be so bad if it could remove the need for Fear checks if Difficulty is reduced to < 1 before upgrades are considered? I don't think it would be all that bad, and I have yet to see a character with more than two ranks of Confidence.