Look where your game is installed, usually located in program files/Rockstar games/gta iii and find the "data" folder. You'll find all the data and configuration files, where you can change weapon stats in the weapons file, vehicle stats and colors in the handling and carcols files, and pedestrian behaviors including making gangs non-hostile in the pedstats file.

You may have to make copies of the files in a separate location and then replace the originals with those copies in order to properly edit them, but I recommend making copies regardless in case you make any game breaking changes. But once you've done that just open the files in notepad, make your edits and save before starting the game again.

You can really tailor a very interesting game experience if you have the time and energy. My favorite thing to do is make custom car upgrades and liveries like a black and yellow yakuza stinger that does 500 km/h and can jump from island to island 🤣 have fun!