The problem I've seen with making a character into a weapon entity is that they look more like they're floating around instead of walking, especially when the player looks up.
I experimented around the other day with some scripting that attaches the player to an entity that follows the entity you want to control and it worked ok... not quite ready for prime time though. I'm still working on it, but the idea I have requires 3 entities. Two use DarkAI, the third is a normal entity.
Entity 1: an invisible, indestructable character entity that the player would be moved to each cycle.
Entity 2: The player's character.
Entity 3: an invisible, indestructable entity that would be set as the players target unless an enemy is detected.
What the control script does is move #3 in response to keyboard commands, then the player character (#2) follows #3 and the "camera dolly" entity (#1) follows #2. Naturally it also freezes the player, disable mouselook and point the player at #2 at all times.
Scripting the whole thing has turned out to be fairly complex, and I'm maybe only 50-75% of the way done with it. Here's some considerations I found that you'll need to keep in mind when using such a method:
#1 When your character dies, the script has nothing to point the player at. If you respawn the character, it will look at it again... thru a wall or whatever.
You have to move back to the start point again - so OK, you destroy the camera dolly and respawn it, no biggie, but then you also have to destroy the controller entity and respawn that.... what a pain.
#2 How will the player shoot enemies and still be able to move? The method I'm using right now is just to let the character fight on it's own, but that's not much fun. I think during movement, I'll have to force the entity to stop shooting and retarget the controller entity so movement is still possible. But this further complicates the scripts required; now if the player wants to move when in combat I have to clear the character's target, set the target back to the controller entity, move everyone, wait for the user to stop moving, then retarget the bad guy again but don't let DarkAI shoot it unless the player clicks the mouse... oy vey. Ready for a mod yet? I am.
#3 When backing up, the player ends up in front of their character. Not quite sure yet how to deal with that one - it will hinder game play because you can't see what's in front of you until the character turns and moves to another location. Not a huge issue I suppose, but I would find that annoying as a player, especially if I'm being chased or shot at. What if I'm almost at the end of a really tough level and I get in my own way and die because I can't see what's in front of me? Very annoying.
Then there's just the general weirdness factor that creeps in, at least it did for me - odd stuff that you can't explain. For example, in my test level that I set up for this, when the character passes thru a certain door (I'm using the stock sci-fi autodoor) it's almost like the character smashed thru it because the door breaks and pieces of it end up clattering around on the floor. I was like "Eh?" when that happened. The other doors however, work just fine.
It was at that point when I decided I'd had enough and went back to work on my own game which will be a simple, straightfoward FPS (because, go figure, that's what FPSC was designed to do, lol).
If I ever do get it to the point where it works somewhat reliably, I'll release the scripts to the community and you guys can have at it, but I don't know if I'll ever finish them - it's been a royal pain in the arse and the results so far have been "meh". I prefer making normal FPS games with FPSC anyway - if I want to do a TPS (and I do, but I want to finish my FPSC game first) I'll do it in DBPro where I have much more precise control over player and camera movement. Who knows, by then Lee may have added TPS view as a feature and the whole thing would be moot anyway. Anything could happen.
Right now, I'd say if you absolutely must have TPS control, just go with a good mod and be done with it. Making games is challenging enough without having to battle your dev tools on top of everything else you have to do.