At default settings, I run out of ammo on the 1st enemy, and it never recharges.
At cycles = 60000, I might be able to take out a few enemies, but ammo regeneration is still incredibly slow. A few levels in, I'm supposed to protect a ship, but I'm so ammo constrained that it seems impossible.

The framerate is also incredibly low.

Another issue:
If I turn on unlimited ammo, it doesn't seem to let me progress to the next mission, even after successfully completing it?

You did all the wrong things.

1. Run Graphic Mode Setup (outside of the game) > Change to Direct3D

2. dosboxShatteredSteel.conf > core=normal

That's all that's needed. The first fixes the stutter like issue in both video and audio. The 2nd fixes the lasers not recharging issue. The mouse might feel a bit weird in the menu's but that's it. I did not fully play the game but it works good during the first two missions.

The game warns that enabling unlimited ammo results in being unable to advance. For whatever reason they thought that was a great idea.