I don't think this is better as you're turning friendly fire a non-issue.
Friendly fire is why a fight involving friendlies is harder that a one on one. Making it so I can strafe a laser across a cop's hull and not have to bother releasing the trigger does not improve combat. It just doesn't. =/
I think the only potential issue here is that NPCs could be a bit more careful but in reality do players EVER think about if they are getting in someone's line of fire? No of course not.
That is why I stated that hitting them still causes fines and other problems. I am not trying to disregard it, I am trying to stop 100CR fines from costing me over 100K because the AI is incompetent and the system is broken.
Adjust the numbers to whatever % of health, I just don't think a single bullet should cause me to get killed.
In real combat situations you don't run in between a couple of guys shooting it out.
The situation here is something like this.
Say there is an old west shoot out in a canyon, only the bad guy and bounty hunter duking it out. They are firing at each other when the sheriff and his posse show up. One of the posse sneaks behind you and as you start to empty your revolver he sticks his face right in front of you. One round goes through his hat before you stop. The sheriff and his posse see that you have wounded his beautiful 10 gallon hat, watch you shoot the bad guy, then they hang you from the nearest tree.
Any kind of real scenario I can think of that comes close to what the NPC's are doing all involve retards doing everything they can to get themselves killed and get mad when they get a little roughed up.
There are lots of ways they could fix it. They could program the NPC to avoid paths that are directly between you and your target.
The EASIEST way to fix it that most people would be ok with is simply lessening the penalty for the AI stupidity.
I am not even asking to remove it, only make it slightly less severe.