Unfortunately VATS is badly nerfed compared to Fallout 3.
That about sums it up for me too. I'm playing a melee character who happens to have 100 in guns at lvl 30, but I didn't take any of the gun perks along the way so my VATS accuracy is pretty low even with high skill. I tend to pick things off in the distance with a silenced .308 and use vats when they get into melee/unarmed range. Sometimes I'll run in and give a Cazador a punch and then dip into vats. It's definitely a bit more of a balancing act this time around. Before I felt like you would use 5ap a shot, didn't matter anyway because of the Grimm Sprint, wash, rinse, and repeat. If I ever get into dire straights I find that I don't rely on Jet like I used to in FO3, but more on regenerative health and by swinging for the fences in real time.
Still I'm no FPS player and I'm glad it has the functionality that remains, it serves as a great feature to the RPG side of FNV.