[Legbreaker]

V1.0 is clunky with it's CUF and hesitations, but it can work if the players help out.
V2.0 tends to fall down only when low Initiative characters fail to take advantage of repetative actions - the ability to lay down cover fire over an area for long periods of time without stopping for example. Low initiative characters in my opinion are best utilised by being assigned belt fed or other high capacity weapons. Note also that a low initiative character conducting repetative actions actually goes before high initiative characters which, providing it's a sensible action (such as covering a doorway with fire) can really restrict the high initiative characters options.
V2.2 evens things out significiantly by allowing everyone to act every turn but giving high Initiative an extra action. In my opinion it levels the playing field a bit too much.

Another issue which in my experience seems to be ingnored almost constantly is the effect of injuries. If a character, any character is injured by anything nastier than a sharp stick, chances are they're doing NOTHING for at LEAST the next round and probably much longer. During this time, the enemy has free reign to do anything they want completely unopposed, including hitting them again, and again, and again, and again. Grenades and other area effect weapons are great for knocking down and opponent and keeping them there without having to be too accurate. Three barely skilled NPCs with a handful of hand grenades each are going to take apart even a highly skilled and high initiative group of PCs if they bunch up too much (as most seem to do) while taking virtually no casulaties themselves.

Naturally, switched on PCs can do exactly the same - take out everyone with explosives.

An Australian infantryman in the Korean War was renown for acutally putting this game rule into practise even before roleplaying was a pipedream. He rarely fired his rifle but relied instead on the sandbag of handgrenades he carried everywhere. Apparently you always knew where he was - just had to listen for the explosion every few moments...