Mercenary - You can choose to be a full on Merc
Pros - access to all equipment also maybe earn extra ISK from Merc missions
Cons - Suits give no faction bonus

Faction Fighter - Your dedicated to your particular faction with bonuses attached. Obviously more scope when the specific equipment comes into play.
Pros - Decrease in SP cost to faction skills & equipment but also still access to allied stuff.
Con -Can only participate in engagements to defend or support that faction (and their allies MM & Gall, Amr & Cal)

Obviously something for the distant future cus at present there is not enough gear. e.g my MM guy would only be able to use Gall vehicles at present. Nice but not much choice. Also I seems strange that a Amarr suited guy can call in a Cal HAV to defend for the MM

I proposed this because I'm concerned for the future development and the question of balance that keeps coming up. (any old time Warhammer 40K players may remember what broke the 2nd Ed was the abuse of certain equipment combo's. The vast choice meant the designers didn't see how over powered it could be till way too late)

I see your points and they are very good ones, can't argue and admit I was wrong.
That said though I was told about the game and being interested I read the fluff concerned. I liked the stories and the animosity between the opposing factions and this is what sold me to it. So when the game asked me to chose a faction and clan I thought I was making a career choice that would shape what I had access to but all it does is define what starter kits you get meaning the entire start sequence is totally meaningless