I think you have things a bit backwards there. Beyond the Red Line is not a mod for Freelancer (which does have a cockpit view), but is a standalone game made using the Freespace Open engine. Also, I'm not sure if something changed in X3, but X2 is definitely a cockpit view title, so much so that when using my joystick, the POV hat is used to actually move your head around in the pilot's seat, rather than snap to a different viewpoint (and it meets all those other requirements you wanted).
I am actually a bit torn on the whole issue of cockpit view. While I agree, having it there adds a level of immersion, it only really works if that cockpit view completely replaces the hud (i.e. integrates the hud functions into the cockpit). For example, Freelancer's cockpit view just added a windshield layout over the view, but kept the entire exterior view hud intact. In that case, having the cockpit view was not immersive, it was distracting. By contrast, X2's cockpit view is so immersive, especially on a wide screen monitor, you get completely sucked into the game and the rest of the world falls away around you. There's nothing like getting shot at, then whipping your head around the cockpit to try and see where it is coming from. No other game I've played does that quite the way X2 did.

Yes, it has no cockpit view (i think there's some fan made patch for that, btw), however it is far from an arcade shooter
Like cogadh said, you might want to have a look at its previous version, X2 the Threat; some screenshots here: http://www.gamershell.com/pc/x2_the_threat/screenshots.html
By now, it should be easily available at $10 or so.

Cockpits are a lot of work for something that has very little impact on gameplay plus you have to do one for every ship, so most developers say screw it.

Thanks I actually checked out X2 and I'm really impressed. I'm getting it and probably going to buy X3 as well, since the cockpit mod for it seems to be working just fine.
Not sure where to start though, these games have a lot to them, not to mention the expansion packs, but they look like they're going to be my obsession for the next while.
As for the difficulty of doing cockpits... I figure it's in the same category as doing character models for your game. Skimping on it leads to some players (like me) simply not buying your game.
Now it's just down to HOW MUCH of a market sector we represent.

I can't find it now, as I'm about to head off for sleep, but...
There is a cockpit mod for X3, it adds that immersion you are looking for from X2. When it started off, it actually used the X2 models, ported over to whatever X3 required.
I have no idea if it is still maintained.
I need to get back into X3, though X2 at one point had me setting up the game in early morning hours, and leaving it for the day while at work. Come home to a chunk of new credits, a few killed ships and then forgetting to eat until midnight... Er, perhaps not as much :)

who says that pilots in the future can't see through their cockpits? There's a fighter plane in the US army that already has (or in development, forget which) a camera system which gives the pilot a view in their helmet like there is no plane around them... basically just feeds external camera info into their helmet visor so no matter where they look they see what's around the plane rather than the plane itself...

I think I saw that Macross cartoon. I'm pretty sure it was Macross Plus that had a plane with a 360 spherical view from the pilot's seat.

I like the cockpit view better than the 3rd person perspective, even when playing driving games. I agree it adds more immersion to the games.
Playing devil's advocate though I can see a more cinematic view of the action from the 3rd person. Also in some driving games the external damage to a vehicle can be entertaining to observe. I am probably just speaking out of my ass when say this but perhaps some devs may feel that cockpit view may equate to a sim game with a steep learning curve that may frighten less enthusiastic players, I say again I'm just speculating on that last thought.
However, I am more prone to buy games that give me the option of a cokpit view even if the game is more arcadey. Like Rogue Squadron for example but I had zero interest in a game like Blazing Angels that was just as arcadey because of the POV.
Though I haven't played it, I heard that Tarr Chronicles had many of those options, including cockpit view. However I also read that the voice acting and story were sub par.

you're confusing cockpit view, 1st person with no cockpit, and 3rd person. The OP is complaining that most games have the view from the 'cockpit' but don't actually show you the cockpit around you.

Absolutely. I'm sure pilots in the future will run everything through a HUD on a pair of goggles with an external camera view. Hell, maybe they'll even run a boom behind the thing so the arcade junkies can get a 3rd person view of their plane/spaceship.
Me? I give rocks, I want my cockpit. If I wanted the authentic experience, I wouldn't be bothering with a science fiction game.
Future computer connections will probably all be wireless, yet it's cool having big, bulky armor-coil wound cables running into people's heads in Cyberpunk games.
Caseless ammunition is the way of the future, yet it's absolutely dead on cool seeing a rapid fire weapon spewing out enormous mounds of casings as it fires.
So don't give me any of this 'in the future we'll probably float to work on small sugar coated clouds that fart rainbows so what are you complaining about' crap.

Seconded. Great indie game, and it has cockpits (and TrackIR support!).

I hate the X series. It has so incredibly much potential, and orders of magnitude worse execution than, hell, anything. It's like Egosoft purposely put everything I enjoy into their games, and then with great deliberation and care, ensured the controls and pacing are so mangled that it isn't humanly possible to have fun with any of it. Which I finally admitted to myself, after sticking it out for about a month each time.
Seriously, the entire series is the most perverse thing in video gaming history. The games have maybe 50-150 hours worth of content, but the pacing stretches it into the geologic time scale. And the interface... They might as well just have included a copy of notepad++ and written "code your own" in the manual. On second thought, they should've just done that. No difference in learning curve, and at least there'd be a chance the end result wouldn't require hours and hundreds of mouse & keyboard strokes, just to perform the simplest of chores.
Man.. I hate Egosoft. I've fallen for their nasty hoax game 4 times now.
Wanna know what the easiest & least soul destroying way to 'beat' an X game is? Establish a trade route, fly 10 mins off centre of a quadrant, and let the game play itself for 2-3 years. Trust me, the electrical bill and having to listen to that damn old computer running for years on end, some remote corner, isn't nearly as annoying as actually playing.
But I'll second the Evochron: Legends recommendation. It lacks the tychoon element of the X series, and the gameworld simulation is somewhat simpler. But it has everything else and more (far more to do in the exploration department), and no team of mean little Egosofters have gone through everything with a fine toothed comb, to remove every last trace of fun from it. Really, it's a brilliant game.
Starshatter is cool too. It's a combat sim, not a space sim, but if the idea of space combat with emphasis on realism sounds just a tiny bit appealing, you owe it to yourself to check it out.
Also, I think I just set some kind of record in angry rants about video games. Don't take me too seriously, we're all crazy in our own special way. This would appear to be mine :D

You might like Dark Horizon.
It's not an in-depth cockpit, it's a few out of the canopy (for lack of better word) but it's not just a blank screen either. You can find gameplay on youtube to see what it looks like. I'd like more games with full-on involved cockpits with buttons, displays etc too. Feels less arcadey and like you're *in* the game more.
I prefer a cockpit view in anything flight or driving as well. I can deal without it for space sims, but I do feel removed from the game some. A "realistic" perspective does a lot for the suspension of disbelief and makes a game a lot more fun. Regular flight and racing games...I won't bother without it, it's just no fun.