TWF does not apply to ranged weapons
Where does it say that exactly?
Rapid Shot would get you only one extra attack per round at your highest attack bonus, at the cost of an additional -2 penalty to each attack.
And if I'm using 2 ranged weapons instead of one?
I really don't see this as being unbalancing. For one, a hand crossbow does d4 damage. Even if I had a straight fighter who got 8 attacks per round, I imagine the best he could hope for is 7-12 damage per shot. Compare that to a bow fighter of equal level who had ample prestige classes, feats and equipment to choose from.
Ambidex, 2WF, PBS, Precise Shot, Rapid Shot, EWP: Hand Crossbow, EWP: Repeating Hand Xbow = 7 feats. So a human fighter could pull it all off at 6th level, netting him 5 attacks per round at -4 to each attack. If he had 18 Dex and two +1 weapons, he would attack foes within 30' at +8/+8/+8/+8/+3 (6 BAB, 4 Dex, 1 PBS, 1 Enhancement, -4 total penalty) and potentially do 5d4+5 damage (average 15 damage per round). He spends the 3rd and 4th rounds reloading. So over the course of 4 rounds, he does a whopping 15 damage? I'm quaking in my slippers over here.
At higher levels, I forsee taking some levels in rogue, getting a Rapid Reload feat, Quick Draw, better weapons etc and becoming useful in combat. But I really don't see any reason why this is a bad idea yet.
Thoughts?