yeah NV had factions that were supposed to be clashing over hoover dam and new vegas but the only real fight between them was at the end. I will agree with you about FO3. i just feel like so much more could have been done with the factions.
The way I think faction could be improved is by giving their equipment bonuses and penalties in line with the faction's military doctrine. As far as I'm concerned, the NCR feels like a faction that throws poorly equipped troops into battle, while the Legion throws well trained and well armored troops back at them, especially their higher ranks. However when you compare armor.
NCR regular armor has a DT of 10
NCR Ranger patrol armor has a DT of 15
NCR ranger combat armor has a DT of 20
NCR salvaged power armor also has a DT of 20
Legion Veteran armor has a DT of 10
Legion Prime armor only has a DT of 8
Legion Vexillarius armor has a DT of 14
Legion Praetorian armor has a DT of 12
Legion Centurion armor has a DT of 18
So the Legion's best armor is still 2 DT short of the best NCR, while I think the Legion should have better armor. I think the Legion's regular armor should have a DT of 12/13. Legion Prime armor should have a DT of 17/18, Veteran armor should be around 22. Now I also think it's weird that NCR salvaged power armor has the same DT as Ranger combat armor, so I think it should be upped to 25 resulting in Praetorian armor with a DT of 28, but that would also require all power armors to have their DT upped. Another option would be to lower the DT of NCR armor to 5-10-15-20 and set the legion armor to have a DT of roughly 2/3 points higher than their NCR counterparts.
Now as a more general idea, I think factions should have some strong points and some weak points, in line with their tactics. Things to consider would be
DT vs mobility
ROF vs Damage
Other factors to consider are cost and durability. Things like stealth and accuracy IMO should depend mostly on skill. Furthermore I think you should be able to repair your faction's armor using roughly similar armor from your kills.