I didn't do Stage 2 at all. I got far too dizzy etc. It was really unpleasant. So I'm basically sticking to Stage 1 as a lifestyle, except that my dinnertime pig out is the right food and not in excessive quantities. It's working for me (and I still have wine, coffee and the occasional treat). The weight is dropping off now rapidly. So I say modify it to suit your needs.
If you eating only paleo foods sounds more like stage 3. You scared me when you said you were sticking to stage 1

But sure, some people have trouble fasting. Especially if your use to eating a high carb diet. I bet if you ate Paleo for a couple months then tried fasting it would be a lot easier.