Yup, this is actually the thing I hate from the engine, even adding a simple bone will void all vertex animation.
Changing to bone animation is not just cumbersome, it also will cause slowdown if large number of bone-animated-models appears on screen.
You can use darkinferno's suggestion, by breaking the model to upper-lower body.
Or, you can manually divide the animation and use ANM_ADD.
1. Create a series of pose/animation for your soldier looking/aiming up to looking/aiming down(eg: looking 60° up, looking 30° up, looking straight, looking -30° down and -60° down) for the upper body and remove the lower body animation(of the same model)
2. Create another animation for walking/running/standing with unanimated upper body.
3. Animate the entity by adding the lower animation for walking/running and the upper animation for 'rotating' the upper part.
I used this technique a long-long time ago but not on 3DGS(in 3D engine I wrote in DOS
), so I'm not sure it will work here.. It will also get trickier f you want to rotate the upper body horizontally...