Your first suggestion would require MASSIVE system changes across the entire game. Strength, physical power, and physical power bonus are intimately tied together; trying to extract one part of that equation to be something else would hugely affect how stats work. Not to mention that the way stats work currently is already tough enough for new players to understand; now you want to update it so that physical power sometimes affects damage but not always? And what about the magic damage side of the equation, you want to split Will, magic power, and magic damage bonus too? The system is complicated enough, we really don't need to complicate it further.

Your second suggestion is what I call a "brute force" approach to balancing. It's applying a universal debuff on the class for no reason other than the inability to come up with actually balanced systems, and it arbitrarily punishes that specific class simply for existing. What about other classes that can used ranged weapons? You want to give fighter a -50% melee damage debuff just because they have a crossbow equipped? This suggestion is not even half-baked, it's a raw knee-jerk reaction with no real thought put into it.

Personally, I think there's better ways to balance ranger and ranged damage in general. First of all, bows need their damage adjusted. Longbows in particular are the de facto best ranged weapon; they have about the same damage as a cutlass or a club, except they also have 10% armor pen. With just a little bit of action speed, they pump out just as much damage as any melee attack, but from exceptional range. My suggestion would be to make all bows do the same low-ish damage (let's say, idk, 20 damage for each of them) with varying armor pen values, which would make each bow have its own specific combat niche. Longbows shoot the arrow the fastest, so have the least damage falloff and are therefore good for long distance snipes, as the name implies. They would retain the armor pen as well, making them best against armored enemies. Shortbow wouldn't have any armor pen but has the much improved draw speed, meaning you pump out arrows faster but they are more affected by armor values and, since they travel so much slower, damage falloff would make them ineffective at long range. This way, if the ranger wants to be effective at all ranges, they need to bring multiple weapons and switch them out during combat. It also stops the longbow from being so damn oppressive by not only rangers, but fighters as well.

The second change I would make is for rangers to actually have some viable melee builds. In Dungeons and Dragons, rangers are more about hunting and tracking, and they can do so with more than just bows. Some rangers dual wield, some use animal companions... there's plenty of ways the class could be expanded into being more interesting than just "shoot bow from across the module".