I kind of have to agree with Gizmo on this one, for the most part at least.
I like VATS, but it's more bullet-time than turn-based. I do think there's room for it's improvement within the mechanics of the game and how it functions, though. And I do like the idea of expanding it to allow for other targeted shots on stationary objects. Could have some cool potential there, possibly.
Like Gizmo said, though - VATS is basically an aimed shot. The biggest difference between Fallout 1 and the targeted shots and Fallout 3's VATS system is that in the prior you were taking a risk with an aimed shot. It cost an extra AP to attempt, often had a lower hit percentage, and could mean a wasted action. (Get your AP to 10 or so, pick the right perks and 2 aimed shots a turn wasn't at all impossible, though.) In the Fallout 3, it's more of a bonus special ability, however - you're not only risking nothing, but have everything to gain in it's use.
For players like myself, it also serves as a convenient "oh crap!" button. Mass Effect kind of taught me the strategy of pausing the game in real-time combat, looking around to take stock of the situation, and then pausing again to plan my next move. VATS kind of simplifies that for me, and allows me to make a couple of attacks all while within that paused state.
I think there's something to be said for trying to bring back some of the risk involved in making an aimed shot. I wouldn't (on paper, at least) be against the idea of bringing damage taken while in VATS back up to normal and encouraging more tactical use of such attacks. I think there could also be some better implementations all through the VATS system.
As far a actual turn-based combat - again, I'm behind the idea on paper, but there are some problems with that (and I say that as a staunch turn-based gaming fan.) My primary feeling is that turn-based functions at it's best when you're in command of a group of characters. It makes the micro-management and tactical planning much easier to digest. There's tactics in turn-based games that I just would never be able to pull off in an RTS, for example.
As Fallout focuses on your PC as the only entity you really need to worry about commanding, it pains me to say that turn-based might not be the most intuitive fit for this sort of game. At least not classic turn-based gaming as we've generally seen. I do think there's some potential for a game mechanic that allows you to select your moves for your character and then see everything play out in simultaneous real-time before returning to your character's planning phase, but that's not something I see Bethesda getting too far into, and probably says more about the sort of games I'd be interested in designing than anything else.
Fallout's probably going to stay real-time, barring some potential spin-offs (that I'm sure I'd eagerly buy, mind you.)
And I really do, if I'm honest, tend to dislike the "just make it optional" compromise you see in a lot of forums. Personally, if the game devs don't feel strongly enough about a mechanic that they don't feel it should be an integral feature of the game, then I'm not sure it'd be a strong enough contribution to warrant its inclusion in the first place. Myself, I feel like gameplay options ought to be limited to difficulty, gore, and the like. VATS is already optional as it is - making a toggle for different "types" of VATS doesn't feel like game design I could really get behind.