Apologies for the slightly slow reply and welcome - I've been somewhat occupied of late, including an unplanned computer reinstall after it went wibbly last week.
The explosion should get weaker, instead of do less hits as it projects from point of detonation.
It has some potential as an idea, depending on exactly how it's handled.
I'm wary of having blast weapons continue to do a large number of hits at all radii, as working out multiple hits is time consuming; the falling off on the number of hits does at least naturally limit that.
(I once had a discussion to this effect with PrecinctOmega about the auto fire rules in his version of Inquisitor 2 - although the rolling to hit was much faster, you then were likely to get many more hits than the existing rules, and working out the damage for that could make the whole process much slower as a result. That said, I did use something similar for IRE's flame weapon rules, but with different underlying numbers, so it didn't result in quite so many hits).
Still, a mechanism that resulted in fewer hits on average, but scaling the damage instead could potentially be an approach to go with; working out a damage modifier only needs to be done once for each character, but each additional hit is multiplicative.
Personally I would use another method to work out the number of hits. A roll against an updated blast number with modifiers for smaller locations of the body, e.g. no modifier for legs, abdomen, chest +1 for arms +2 for head. Could even add an additional +1 in the outer radius of the blast if it needed further balancing.
Hmm. If I'm interpreting you right, that immediately calls for eight rolls (2x legs, 2x arms, chest, abdomen, groin, head) with varying modifiers each time a character is hit, and the order is important, so they can't just be rolled as one. Even if they're just D6 rolls, that's still going to be somewhat time consuming. Of course, the trade off is that does remove any need for location rolls, so possibly it's even on time.
The fact that it creates an exception within the rules with a unique way of choosing hit location, I'm a bit less happy about; IRE has tried to remove such "special cases" where possible (for example, "Close up" and "Arm's Reach" are gone from IRE's melee rules, as the new way Reach works naturally represents those).
The other concern I have is that I want to maximise compatibility with first edition; I don't want having to maintain more than one character sheet to be a barrier to IRE. (As is, although IRE has added a couple of melee weapon characteristics and Psy Rating, IRE character sheets are mostly back compatible into 1stE, and with a couple of exceptions like psychic powers, a 1stE character sheet is usually quick to update).
However, complaints aside, I do see potential in the idea. My first thought is that if possible, I'd want to preserve the existing profiles, instead trying to see if it was feasible to choose modifiers that had you rolling
under existing blast values. (Rather than over an updated one).
I'll need to do some numbers and tests to see how well it can be made to work, but I'll take a look at those as suggestions. I suspect I may also still need to do something about the way blast interacts with armour for the reasons noted above, but we'll see what the numbers say...