Super cool ideas, this would be re-introduce armor damage into the game in a less-significant way, which is something I was concerned about. I always thought it was cool how high-damage weapons can "open the door" for less high damage weapons to start doing damage. I would be happy if this could be implemented.
The trouble I see with the idea is that a ship would have to survive multiple hits to its citadel and only then have less effective armor, and only on that one cell. For example, the Hammerhead has 500 armor and 5,000 hull. In just ten citadel hits, the Hammerhead would be destroyed, and the armor fatigue would be irrelevant.
Well, here's two thoughts:
1, addressing citadel hits:
Maybe this could be a high-difficulty maneuver. You have one reaper torpedo mounted on your frigate, and you manage to hit a capital ship with it! Citadel armor is massively fatigued, and now your smaller cannons can get hits in, but only in that one spot you hit it! This could be a very cool little tactical choice a player could have.
Of course, it would be less of big deal with less effective citadel hits, or more spread-out hits. Hitting a hammerhead five out of ten times in five different places may not make a difference in each of those places, but hitting that hammerhead five times in the same place would leave that spot very vulnerable.
2, addressing compartment hits:
Armor fatigue for compartment hits could still be very effectual. After all, to penetrate the citadel armor, you still need to get through the compartment armor, no? That's maybe about a ~16th of the total armor you're having to penetrate. If it was torn to shreds by a just-barely-too-weak cannon, maybe that cannon could just-barely begin to penetrate the citadel by riddling the compartment in front of it with armorless holes?
I think it would add a lot of great options for weaker weapon loadouts to be able to deal with stronger targets with such a mechanic. It wouldn't be as impactful as armor stripping is in vanilla, but for the desperate player fighting a desperate fight, it would be impactful enough.
It would also create interesting situations where a player ship has been hit on one side, breaching citadel armor, which would force the player to mainly show the other side of their ship to even somewhat weaker cannons, changing the tactical situation.
Edit: It seems I have finally made it to the end of these pages. Feels like I've been reading a book. At next opportunity, perhaps tomorrow, I'm going to download this mod and finally give it a try! And equipped with a decent idea of what is happening, too.