Okay, let's go with the common sense ruling if you'd rather disregard the written rules:
If I can swing a huge battleaxe towards an enemy who's fighting my buddy, with a great big wind-up and absolutely no finesse whatsoever (IE an All-out Attack with a Great Weapon) while he tries to dodge and my buddy is fighting with him, I should be able to jam a pistol into his belly and pull the trigger.
Yes, that is true IF YOU PASS YOUR BS TEST.
But since you didn't, you didn't jam your pistol into anything. In the case I am referencing, what you did was shoot and miss not by a lot, but by just enough to hit your team mate were you shooting into combat from a range of ONE METER farther back.
You think that being one meter closer to something makes friendly fire non existent?
Once again, ignoring all the rules and the fact that this game was an abstraction...
First off, you'd only ever possibly hit your ally if you were both attacking from complete opposite sides of the enemy or you were an outright HORRENDOUS shot. 'Melee' assumes that, for the most part, you're within arms reach of the opponent, or at least the reach of a sword or a staff. If your ally is two inches from the enemy and you're standing two meters back, you're not in melee. The mere idea of being in Melee assumes that you're fighting forward, moving in, trying to actually, you know, FIGHT IN MELEE rather than merely taking potshots from a short range.
And, even if your ally was on the opposite side of the enemy, and you fired at the enemy and you missed or whatever, you still wouldn't be likely to hit your buddy, because he's on the opposite side of the enemy that you just missed. You'd need a magic curved bullet, or else you'd have to be firing off to the side to hit him realistically.
And, once again, IT'S AN ABSTRACTION. The rules pretty clearly say that you only take the penalty and only hit the enemy when you fire at an enemy who is engaged with combat, but that you're not engaged with. For firing 'Into' and not 'In' melee. This IS black and white as far as written rules go, the only thing it's not black and white on are the reality of the situation, but since it's an abstraction that doesn't matter.
If you want to extremely analyze every rule issue and nonsense bit that has some kind of discrepancy, you can go ahead, but your combat will all take days to finish because a lot of rules make no sense. Being able to fire a pistol in melee is a balance issue, so that non-melee character's aren't completely hopeless if they get charged or assaulted. It's certainly not overpowered.
Now, if you want to house rule it however you want, that's fine. I have absolutely no reason or power to stop you. But, it's not a rules issue, it's a matter of house-ruling, because the rules are very clear and common sense need not apply.