Piotrovitz
1. Whichever you prefer. There isn't one true option here, plenty of valid choices. I usually go with 5mm silenced one and a 8.6mm hard hitter. (Burst) AP cost is often the most important factor when choosing SMGs or many other weapons. The choice of crafting enhancements is currently, unfortunately, a little boring since smart modules are god-tier and reign over anything else. The secondary slot is usually a rapid reloader, if not an accuracy mod in early game.
2. I find that 5mm SMGs have enough damage with Expertise after the early levels. Silent weapons are a huge advantage if you know how to get the best out of them. Making lots of noise can turn small manageable fights into fighting entire zone of enemies at once. Assassinating Elwood is a different matter, that quest is years older than the noise system.
3. W2C, generally speaking, is the best ammo. Special bullets usually aren't worth the effort required to make enough of them for automatic weapons., but incendiary bullets can be nice for the extra crowd control.
4. JHP kills soft targets even faster. But ammo availability is more important for automatic weapons, so...
5. Yes. Mk IVs are a a common place to stop since the next tier has double requirements. Incendiaries are also extremely useful, more tactical applications than with explosives.
6. Biology is always useful but never necessary. You can't buy any of the good drugs.
7. Super steel is expensive, so is decorating your house if you're into that kind of thing. Other than that you don't have to hoard much.
Infused siphoner leather is THE armor suit if you want to focus heavily on dodge/evasion and other infused leathers have great choices too. Rathound for crit, pig for hp/resists, hopper for speed, ancient rathound for damage reduction. But tactical vests aren't bad either. I'm fond of using biohazard vest on ranged builds with medium mobility/dodge/evasion. It's far from optimal choice but I don't like carrying a gas mask swap on builds that depend on perception.
Ballistics feat is somewhat underrated. Early on it's excellent, but becomes worse and worse as you grow in levels. However depending on your shield, you might find that the extra DT stays relevant throughout the game. It's just in the area where it barely nullifies or greatly lowers the part of damage that penetrates your shield, more than the meager resist of tac vests would. If you like tactical vests and can affort taking the feat before crafting your first armor, it's not a bad choice. It's obviously weaker on riot gear and metal armor vests, which don't get the +200% (triple!) threshold bonus of tac vests.
Hard is definitely challenging enough for a new player, DOMINATING is meant for veteran players. You don't need savescumming nor exploits, but never even try to fight fair in Underrail. You need all the tricks in the book. At that point no build can deal with the beetles by just marching in and shooting them.
Parabalus
I think SMG builds are underrated. They're about as powerful as assault rifles, have more control over where to apply their damage (more bursts, less overkill per burst), have no crippling weakness, and are also better suited for high mobility builds which are just plain more fun than going for max resist tin can.