Ive given up on suggestions because most people here dont want FOnline to be turned into a "wow"-like MMORPG. In their eyes, HtH is inferior, because a gun wins vs a martial artist IRL.
So instead, ive summarized my thoughts on the issue in my sig.
...Ok a bit more....
HtH needs better survivability, not damage.
As default i treat unarmed to be paired with sneak, because... NINJAS!!!! *cough* So the idea is that sneak should be only usable by unarmed(sneak penalty for weapons in active hands just like high lvl armor)
My unarmed char with 10 luck is an awesome crippler. Not good damage, i break a pigrats both legs before he dies, and thats a good thing. Like some of you mentioned, unarmed should be a disarming/crippling menace, but certainly not an instakiller. So damage wise, i think unarmed is OK.
IMO sneak should work like HtH evade does/would: Give an AC bonus of sneak skill/X to AC while the character is sneaking. You cant know if an enemy is actually seeing you and starting an attack, or he just ignores you or whatever. Sudden death while sneaking even with high sneak is unpleasent this way... Dodgeing an attack should not break sneak. Sneak should have a CD(like the FA formula), but should be used while players can see you and in TB. The 3 hex rule should not be applied while behind the character.
What about melee then? Fastshot. Please. Its a must. Other then that: If sneak has a penalty with melee weapons - and it should(i mean really: sneak with a minigun, or a sledgehammer? No.), then melee needs other survivability. Melee will allways be primary targets, because unarmed are sneaking bastards. They are the ones that soak up the most damage in theory, so either you accept it or not, they ARE the tank class in the game, just like everywhere else. Currently fights end very fast, and melee chars are very rare(because they suck at pvp), thats why it doesnt apply yet. So to compensate that, they need DR/hp. Toughness and lifegiver is open to everybody, but adrenaline rush is still open(because its useless). What would be the best tho game and balance wise -but noone wants to hear this, because everybody want them badly- is to simply give the tanks some armor, PA. Thus limited damage, no crippling utility like unarmed with its high critchance attacks, BUT could soak up a decent amount of damage. See PA thread for details. Im repeating myself, im a troll afterall, but i have yet to hear a valid counter-argument, other then "its silly" and "everybody should get PA".