My question, does changing weapon damage instead of monster health really do the same thing? Since weapons do different levels of damage, might this mess with balance stuff? Or something? Would this make a rocket launcher more overpowered than other weapons for example?
Decreasing weapon damage is pretty much equal to increasing monster health. You have to hit more to kill it. It doesn't bring as much overkill as you'd think if you use empowering values. That's why I added even more customisation values in the latest update - to be able to fine-tune better.
Also I don't see the option to change weapon damage in the zdoom Skill_definition page, how did you arrive at the idea to do weapon damage instead of monster health?
The mighty might of ACS.

I did that because changing monster health for every monster is hard, and it would only work with vanilla monsters, without any compatibility patches. Instead, I decided to change the weapon damage due to the fact that the player is Always there, no matter if he has different properties in DECORATE. The actor properties I've changed should not conflict with any mods. I'm saying "should not" because it Might, but the chance that a mod will change the same properties for the same actor is very small.
Also, does this not include the options to customize ammo and health pickup amounts?
Because I am not using MAPINFO and ACS doesn't have ammofactor change functions. I do not want to use MAPINFO to define those because it may conflict with other mods that use the "clearskills" command which basically removes all custom skills. Pointless, ain't it?
And just curious, is there any way to change the SpawnFilter aka difficulty level on the fly?
You can use the "skill" console command to change it for the next level.
I can also make a submenu that changes the skill CVAR without the need for commands, but it won't give much information since it'll be from 0 to n. Adding descriptions such as "Hurt me plenty" or "Nightmare!" will only be true for vanilla, since any mod that adds custom difficulties like "Hurr durr me plenty" will not match the ones in the submenu. So that's another "no".
One more kooky question, could this mod work in conjunction with a custom mapinfo skillsetting?
Yep! I mentioned it in the FAQ and in the main post like twice. This mod works with all mods and all maps. Due to the way I have designed it, it may not have fancy stuff like custom ammo regen or custom health pickup, but it works with Everything. You can jam 50 other mods in your load order and then this mod, and it won't have any conflicts! It's all about sacrificing some to give a lot more.
Many of the suggestions here seem to be too advanced for ACS, and implementing them otherwise will cost me compatibility. I didn't think I'd ever say this, but...WFDS, lol.