In this sentence, "di quello" is the explicit comparison "than that" (idiomatic translation, not literal). "che" acts to connect separate clauses. I think of it as a kind of glue in Italian sentences.
"E' piu' facile (it is more easy) di quello (than that (thing)) che (which/that) credevo (I used to believe)."
In the exercise going from English to Italian, the "correct" answer is given as È più facile di quanto pensassi - in subjunctive tense, before we get to the subjunctive module. And there is no che in that sentence. One user commented that Duo accepted di quanto ho pensato.
Obviously, an error of some sort is happening with this particular sentence. Very confusing.
It’s really just the “di” that means “than.” “Che” by itself can mean “than” in different contexts, but here it’s a relative pronoun:
È più facile... It’s easier...
È più facile di quello... It’s easier than that (thing)...
È più facile di quello che credevo. It’s easier than that thing that I believed.
In English that sounds super awkward, though, so we say, “It’s easier than I thought/believed.” In Italian you need all of the stuff in between, though.
In the expression "di quello che" di = than, quello = that, and che = which. So , "è più facile di quello che credevo" can be translated literally as "it is easier than that which I thought." In Italian, "that which" is required; in English it is omitted. By the way "ciò che" can be substituted for "quello che."
Personally, I think that is actually a better way to translate this sentence, though I also feel there is a significant difference between believing and thinking. I think that distinction is really only important in American settings as we tend to have a severe problem with separating believe and thought.