An upgrade progression loop is good if done in the right space and balance. The problem right now with the FPS gear grind loop is that it's out of balance with the game design's previous logic. The ship path sort of made sense with the modules costs and engineering grind being a secondary aspect. The FPS gear should be easier than that flow by a large margin to stay logically consistent with the two.
Beyond that the biggest problem is this: The FPS gear grind takes away a logical step of progression that made the ship grind work; the ability to buy modules for it as a first step prior to the engineering phase. We should be able to purchase basic gear for our weapons "Without engineering" in the shop in the form of weapon attachments. Example: Scopes, high capacity magazines, recoil stabilizers, longer barrels, muzzles, silencers etc. And then engineering should require a bit less of a mat grind to enhance damage, fire rate, distance, bullet spread, weapon characteristics, overheating etc.
But the designer failed to follow the same logic in design as the ships which was good and sound in terms of realistic flow. You could play the game for cash to get modules and then later grind for mats afterwards for the improving the function of said parts you bought with cash. We need that consistency here as well as a lesser grind to logically balance that flow into feeling like instead of a massive complex ship, its a suit or weapon that should be lighter to upgrade but still be a rewarding fun sense of progression.
So the flow should be:
1. Purchase weapons for cash
2. Earn or use additional money to purchase modules or attachments for your weapons to customize them and improve their default ability or lack of.
3. Engineer the weapons to effect base characteristics ( enhance damage, fire rate, bullet spread, overheat, effective distance, night vision Scope etc.
Regarding gear suits due to the more limited scope of customization I am okay with these staying as engineering only and no modules. Weapons however I feel were done wrongly. They could of sold the base suits and then sold all the cosmetics in the store as well as further pieces of armor that improved the suits default armor levels or resistance levels if they wanted to keep that consistency.
So the flow could be:
1. Purchase new base suit with credits.
2. upgrade armor level, resistances by purchasing add ons (torso, legs, shoulders, arm pads with credits) to get maximum value.
3. Engineering suit now only affects function modules (more carry weight, night vision, Quieter footsteps etc.)
This would keep the flow consistant across the board and make the customization part of something to buy with in-game cash instead of the meaningless dress up in the cosmetics store which honestly feels stupid. It would become a store purchase function for armor/resistance with retained ability to purchase the look you wanted still.