As was mentioned above, it's important to bear in mind that in a game, developers can balance any system that they care to put effort into, and this game is clearly a project that this guy is willing to put effort into! This game is about survival. That is the absolute primary conceit. Everything about this game centers on survival, and all other pursuits are auxiliary. The better survival horror games that have ever been made have used scarce resources as a primary method to apply tension, and this mod is right up there with the best of them. However, another great aspect of good survival horror games are the last moments where you see a threat bearing down on you, and you hear a click from your firearm, and you pull out a length of pipe or a 2x4 and say "Eff it. I don't want to die, and this is all I've got left, so let's do this and see how it goes." Managing to overcome a threat that should have killed you with your very last resort is one of the most satisfying, visceral game moments that a player can experience, and Day Z is nothing if not visceral. If the system were properly balanced, I don't believe that it could do anything other than improve the overall experience.