Has anyone actually tried running a test-combat situation, one using the 1st theory, and then a 2nd using the other, and seeing how the combat results turn out?
Set up a combat with two sides, each of which have some individuals with no armor, some with light (ballistic cloth) armor, and some with Combat/Battledress, and a variety of weapons from light slug-throwers thru heavy plasma weapons. Run the combat using each system and see what happens.
If one of the two gives ludicrous results, you can fairly well eliminate that one as viable possibility.
The 2nd theory (Lichekings) jives entirely with the rules as written, right up to the point where the actual affect of damage is included only under the "Optional" V0 rules. Then it all falls apart.....
Player A has a gun that does Bullet-4 and Player B (97A6A8) has Armor-8. Player A fires at B and hits him. He rolls 4D for damage and gets a total of 16. That destroys B's armor for this encounter and passes 8 hits on to B.
If we follow the rule on page 222 then 8 hits are applied to B. We roll for location and get 7 = Torso. We go to the table below and determine B has taken Total Hits/2 = Severity 4 injury to his torso. Now what? The rules don't SAY what to do next. We could turn to page 183 and look at the Injury column ("Wound" in the book, but "Injury" now as per Errata). But that actually doesn't tell us any more than -4 = "4D Heavy", and technically we are just guessing at that because nowhere does it actually SAY that a severity 4 = 4D Heavy. Also on page 183 is a Severity chart, but that chart has -4 = Critical 4D, but it has the same general issues as the Injury chart has. Then there is page 182 which also has a "Severity" chart, and this chart actually has a 4 on it, which equates to Very Severe, which doesn't exist on the Injury chart. Fortunately we can rule this last one out though, as it actually is the same chart as on page 47, implying it is meant primarily for Risk, not injury.
The way I think it works is that you write down on the character record Severity4-Torso (needed for healing of this wound with medic rules post-encounter). Then skip to page 225, which says "Hits to Characteristics are applied randomly and in Dice amounts." Okay, we can do that. We have a Severity 4 injury, so we assume that means 4D. The chart on page 225 says HITS apply to C1, C2, and C3. So we roll dice... 1-2 = C1, 3-4 = C2, 5-6 = C3. We roll 4 dice total and get 1, 3, 4, and 5. So 1D to C1, 2D to C2, and 1D to C3. We roll the dice and get 1, 2, 6, and 3 respectively. B's characteristics are temporarily reduced from 97A6A8 to 8076A8.
Wow. This actually isn't too bad. The process is actually covered in the rules, a little under-documented, but it is all there. YEAH!!!!
But wait.... What happens next? B now has one characteristic at 0. What is the actual EFFECT of this injury on the character? It is stated Under V0 he would be unconscious, but because V0 is optional we aren't using it. So what happens? Detailed search of the book and.... No other rule covers what happens as a result of a characteristic being reduced to 0, so nothing happens.
So lets continue our scenario.... Player B starts to run away to his ship, which isn't too far away. Player A fires again and hits B. Player A rolls 14 for the injury, and with no armor player B takes a severity 7 injury to the torso. The 7 hits are spread over his 3 characteristics and do so much damage he is now at 0006A8. So now what?
Well, there are no task checks to fail in this game for walking or even running on flat ground. So even though B's physical stats are all 0's he just keeps on running. Soon he is on his ship and under the care of the ships doctor. But wait! The "Doctor" is a hack and makes both wounds worse. Over and over and over he does this. Soon B has a Wound 12 and Wound 15 on his Torso. But it's okay, because there are no rules for dying without V0. He just keeps on going, wandering around the ship, unable to do anything useful and now beyond the reasonable care of any doctor in the galaxy, but still able to move around and interact with people. WTF?
I do have an easy Errata style fix though. Move the last three paragraphs from HIT SYSTEM V0 on page 215 to the top of the page so they fall under the Detailed Effects section. Also add "-V1" to the "NPC Effects" section title, and "-V2" to the "Detailed Effects" section title. This should fix the combat system, though technically there should be a tad more added to Detailed Effects to ensure the transition from Hits to Severity to applying damage to characteristics is clear.