This can be done with one person and two controllers. Just start up the first level on Normal, making sure to have "Friendly Fire" turned on under Settings. Have the second player join as a "Shadow Bro". They'll have access to all of the tapes on Player 1's profile.
What you want to do here is set your stance to Magic Gambit and Dragon Swarm for your sosetsitsu. Now just slowly crawl through the level, pressing RB to attack any enemies you run across. Make sure to stand around and let your magic gauge recharge after you clear out each section.
The only mildly tricky part is when you get to the first Abobo that busts out of the wall. You'll need to be sure both players are up towards the wall right when you reach that part. Otherwise one of those enemies with a whip will come in from the left side of the screen and get in a cheap hit on one of your characters.
Oh, and as far as those whip enemies go...If your Dragon Swarm isn't leveled up enough, you'll only manage to knock those enemies down rather than kill them outright. Make sure you run over to them quickly and do a ground attack (Down on the left stick + X) to kill them without wasting another Dragon Swarm on them.