The ship damage mod is made by NYGM team. The ships sink by flooding, not fires or anything else. So, aim your deckgun below the waterline to punch holes to the hull. It takes time for the ships to sink.
Good to hear you like GW, we are going at flank speed towards our next release and believe me, if you like GW1.1, you love the next version!
Here´s the URL for the GW website
http://www.users.on.net/~jscones/TGW/ . Under the 'Latest news' you can see what were are doing for the next release.