I personally think building a FPS-Shooter with 3dgs is foolish
Only because you dont know the engine 100%... If a person wanted to use low res graphics to style their game and with optimal code, why not?
It all depends on your own ability to create a game. I could personally, and easily create a low res fps and market it to people with low end rigs with this engine... Once my friend figures out shaders a bit more, we will likely start something.
As a group, what kinds of games and audiences should we be targeting?
Basically anything you can possibly create, can be targeted at any audience with the right marketing tact.