What is the advantage of Street Fighting/Self Defence over Pugilism? Pugilism grants the number of DICE for combat as the level of the skill, whereas in SF/SD it is only a combat add. For defence, Pugilism gets the same bonus but EVERY ROUND, whereas SF/SD can only use the bonus ONCE per fight (albeit distributed as the player desires). The only vague area I can see is if SF/SD can apply the defence against weapons. Pugilism specifically states it does not apply to weapons, and SF/SD says its defence works "akin to the way Pugilism functions", which would imply it cannot be used against weapons.
The only advantage that I can see is that, during Character Creation, it's a Cheap Skill that can be used to give a quick boost to other Fighting skills-which then accrues its own AP as a separate skill. A PC with Pugilism 3 has a distinct advantage over a PC with Pugilism 2-but Streetfighting 2 added to the latter PC evens the playing field a little. I don't like the Brawling Skill much as written, but if I took Brawling a little cheap Streetfighting might help me survive one bad SR..
And given the fact that Streetfighting seems to be about 'that unexpected edge that lets me get in a few cheap shots/unexpectedly survive a hit', I don't see why you couldn't use it WITH a weapons skill (ever see where the duelist locks up blades and then gets in a nasty kick? Tosses sand in an opponents face and then cuts him down? Streetfighting). Allowing PCs to absorb Weapon Hits IF they have a weapon/object at hand (aka the 'parried your thrust with my cloak' defense) would give the Skill a bit of added spice without overpowering anything.
Except that description for Street Fighting specifically says: "This skill cannot be combined with any other skill". I guess that means combined during the same round, not for the duration of the whole combat.
But otherwise I think I agree with you, if the Gamemaster allows it to be used with and against weapons, it would make it a useful skill without being overpowered.