Yeah, you're not really meant to be able to slay those Behemoths the first time you go through, and you can forget about the Adamantoise. I recommend just fighting what you think you can take until you can proceed into the next area (there will be a Behemoth fighting some other thing blocking the way, but you can sidestep them easily). If you want to grind, definitely do it at Taejin's Tower.

As for upgrading equipment, only upgrade weapons that have an ability that you find useful. Like a weapon that improves Fringeward, or Cure! Base stat differences don't mean much in the long run. Accessories just depend on the situation you're preparing for. If you see something that seems like it could be useful, or would be useful if it were more potent, upgrade it!