I think missiles should be made as suggested, to have a more modern feel to them: nearly fatal on impact (of course, this doesn't take into account deflector shield technology, does it? If your shields are charged pretty strong, they should be able to take one missile, I think, with a second hit being instant death. Obviously real fighters don't have shields...yet). And also as previously suggested, they should be capable of varying yields...and any "advanced" projectiles should be rare. I
hated having to dodge advanced missiles for 90 seconds. Ships should have a chance of shooting down certain projectiles, but with a very low success rate. Didn't ships try to blow up torpedoes heading for them in WWII if they couldn't evade them?
I don't know what games you all were playing, but as far as I remember, you were only likely to kill a fighter with a torp if the craft were a bomber or not manuvering. And even the AI evaded concussion missiles on a regular basis. And cap ships and most turreted transports had an uncanny knack or kocking down any warheads at maximum range. (Hate those ETR-3s SO MUCH!)
What was my point? Except for the hideously long fuse that has been mentioned a few times already, I think they functioned quite well. Though I would like to see a more FreeSpace-esque targeting and firing model: no switching to warheads and then waiting.
I think the time and effort needed to acquire a lock was meant to encourage dogfighting with guns. In Freespace, you didn't have to make an effort to acquire a lock, so you could try gunning down the bandit while waiting for a lock and then, if you wanted to, you could spam them if you like. In the X-wing series, you would be forced to dumbfire if you wanted to place one up the exhaust nacelle, unless you were much more maneuverable than the enemy. Although, they seemed to be able to acquire locks
while using guns (which wasn't fair and I never understood why I couldn't). If you want to encourage gun combat, I would suggest devising something that discourages missiles, long reload time maybe. However that's directly struck down in RotJ with the A-wings shooting concussion missiles at the sensor globes on the Executor. The alternative is using the existing SW model. Otherwise missiles would have to be totally nerfed. They are too powerful in the SW universe to be spammed like they are in FS.
However, the warheads in Star Wars games have traditionally been more annoying because they don't lose the lock, they just keep tracking you until they're destroyed (by a weapons fire, hit on something or a life-time counter). Imagine if all the Hornet missiles had about 1-2 minute lifetime and they would keep tracking you even if you initially dodged them. I remember many missions where I had to engage a Victory Star Destroyer and it kept launching three missiles at me every time I targeted it... it was rather annoying, to say the least.
There's an easy workaround for that, don't target the ship until you take out it's warhead launcher (little harder on a Vic though). Also, don't launch from too far away for the smarter captains that intercept torpedoes with missiles.