Crimson Fields is definitely a long instance, and it includes a really nasty 5,000 health monster to test your stamina, but it's nowhere near as monstrous as Sunken City or Kensington. I soloed it last night at level 38. It took awhile, but it wasn't that difficult. Just took awhile.
I haven't come across a "Sunken City" for Moo Shu yet, but I've just done Hametsu, Tatakai and Crimson Fields, plenty I haven't seen yet so I dunno.
Another long instance in MooShu is Shirataki Temple, but, like Crimson Fields, it is no Sunken City. The Tree of Life is another instance in MooShu, but, despite having the highest level Boss in the game, it is not very long.
A key difference between Sunken City and the MooShu instances is that Sunken City is an optional instance, whereas those are not. Crimson Fields, Shirataki Temple, and the Tree of Life must be completed before you can progress in the storyline. As such, they are more akin to Emperor's Retreat in Krokotopia or Katz Lab & Big Ben in Marleybone.
So, if we look at optional, extremely difficult instances, we have:
Sunken City in Wizard City Tomb of the Beguiler in Krokotopia Kensington in Marleybone (which is, by far, the most insanely difficult instance in the game)
Using that criteria, there is no equivalent in MooShu. (Yet?)
I would have to agree with the others. There really isnt a "Sunken City" in Mooshu. The only things I can think of that make it more difficult is that you have more Bosses it seems like in Mooshu then the others. Also you seem to get pulled off the "sidewalk" and into alot more battles in Mooshu making it harder to get from Point A to Point B. The instances are not really hard. Just annoyingly long at times. Another thing is that with some of the main Bosses, The War Oni, Plague Oni and Death Oni, you have to kill another Boss first and then the Oni will spawn dirrectly after. Then of course you have the Jade Oni at the end who is 7500 Life Points alone!