To be realistic like Klingon or Romulan cloaked ships, I don't believe a cloaked ship should be partially visible or fade in/out like the original Elite game. However, I like the idea where it can be detected on scanner with night vision but not targetable else it will be not much different to silent running.
I agree a cloaking device shouldn't interfere with ship's SG. Since some of us have agreed a cloaking device cannot be used in SC or within no fire zone of stations when requesting for docks, then a scenario where it can be misused for ramming another ship is in normal space outside of stations' no fire zones. To prevent ramming misued, maybe FDev can delay the de-cloak process by a few secs where ship cannot be used for ramming until it's fully de-cloaked before it can deploy/re-activate HPs.
I'm not sold on the idea cloaking device de-activates shields because I reckon it should be used for defense rather attacking another ship.
I think ramming and sneak attacks are legitimate activities that a cloaked ship pilot would want to do. However, given the hit to power consumption which reduces shield buffs, and the increased armour weight that reduces manoeuvrability, it remains a risky prospect. It's worth it to consider the differences between Silent running, and Cloaking as we're proposing it.
Sneaking up to a ship to ram it or open fire on it.
With Silent running, your ship will show up on the radar once you've entered into the auto-resolve range of the target ship's sensors and so you will be targetable. You will also be visible, so you'd need to approach from their blind spots, and if you want to open fire, you can try to do so from outside the auto-resolve distance, but you may not be able to easily ram your target.
With Cloaking, the commander of the target ship would need to be monitoring their sensor screen to notice your ship in the vicinity. If there are a number of other ships around, then your cloaked ship will likely not be noticed on the sensor screen. If your presence on the radar is unnoticed, you can approach as closely as you want at any angle before deciding to ram the ship or open fire, so I think Cloaking is probably better for this purpose.
Smuggling goods into a station.
With Silent running, as long as you're heat management is half decent, it's fairly trivial to get through the mail slot or onto an outpost's landing pad without being scanned, and without sustaining any damage, or very little if any.
With Cloaking, it should be just as trivial, except the concern is about cloaking time remaining rather than heat buildup, so I think the two methods are roughly on par in this regard.
Escaping pirates and bounty hunters.
With Silent Running, while outside the auto-resolve distance, pirates and bounty hunters cannot target your ship to scan it or open fire on it with gimbaled or turreted weapons, but if you're around 1-2km away, you would likely be spotted, and any fixed weapons can cause you trouble, or the enemy ship can move towards you within the auto-resolve distance and scan your cargo hold or scan your bounty reward.
With Cloaking, other ships cannot target your ship to scan your cargo hold, scan your bounty reward, or to open fire with gimbaled or turreted weapons, even within a few metres distance. Also, as you will not be visible, there will be some difficulty in accurately firing on you with fixed weapons, though it's possible because your location on the radar will allow your direction to be tracked by the pirate, that is if they're paying attention to their sensor, and if there aren't a bunch of ships clogging up the sensor screen. For this reason, I think Cloaking is slightly more useful for escaping or evading pirates and bounty hunters.
Pirating or bounty hunting in normal space.
Scanning for bounties or cargo is probably more convenient whilst cloaked, as you can do so from any distance, whereas with Silent running you need to stay out of auto-resolve range, and scanning also increase your ship's temperature (I think).
It's also easier whilst cloaked to get into position for a pirating attempt, or to fire the first shot for collecting a bounty. However, the power requirements and weight increase of a cloaked ship will mean some sacrifices in shield buffs, making both professions a little more risky.
Other applications?
There are probably some other scenarios where cloaking can be used that haven't occurred to me at the moment, so if anyone can mention any that would be appreciated.
I also foresee possible future missions like scouting and reconnaissance where you have to avoid detection whilst observing and collecting some information, as well with avoiding detection when hacking installations, which is currently in the game.