Does it mean that Paradise is surrounded by hardships, requiring misery in this world for whoever desires it, while Hellfire is surrounded by pleasures, requiring worldly happiness for whoever follows them?

This Hadith is authenticated in the two Sahih collections (Bukhari and Muslim). Its meaning is that Paradise can only be attained by performing acts of obedience that the self dislikes and by enduring the hardships of worship, whereas Hell is reached by committing forbidden acts and sins that the self desires. Imam An-Nawawi explains that this Hadith is a beautiful statement, meaning that Paradise and Hell are veiled by disagreeable things and desires, respectively. So, whoever tears through the veil of Paradise has braved disagreeable things, and whoever tears through the veil of Hell has indulged in desires. Disagreeable things include striving hard in acts of worship, patiently enduring their hardships, suppressing anger, and giving charity. As for the desires that encircle Hell, they are forbidden acts such as alcohol, fornication, and backbiting. Permissible desires are not included here, but it is disliked to overindulge in them for fear that they might lead to forbidden acts or harden the heart.