Can ships use guns?
 

I've noticed in DW that ship vs ship engagements never result in gun battles. They always sail away from each other and use missiles. I've only ever seen cannons used against planes and missiles and once on a sub. Are there any mods? Because its stupid seeing the RA Iowa not using its famous guns.

As far as I know, the doctrine files have platforms attack with the longest ranged weapon possible with the highest chance of a hit. Since most platforms are in missile range long before gun range, it is unlikely for an AI platform to use its guns. I do not think it is a bug or an oversight.

I'm no naval tactician, but isn't naval artillery used more for shore bombardment in modern times, and ship to ship ASUW done with AShMs?

Sounds about right to me. The only thing I can see guns being used for, other than shore bombardment, is finishing off targets. Missiles are the primary weapon for ships, now.

I know this but it's more common sense issues I'm worried about. One ship could have finished off a damaged frigate but chose to go a distance away before shooting a missile. It took unnecessary damage in the process.