Reloading a 1-shot pistol as a free action seems kind of ridiculous. That being said, the only advantage over a cross bow I can see is you can reload it faster by spending an extra feat. The pistol doesn't seem especially different than the light crossbow in this way, other than a small damage upgrade. You could easily just make an improved rapid reload feat for x-bows that make reloading a free action and you'd have almost the same weapon.
I would say that my rules replace cross bows, but normal bows are still viable since reloading them is always a free action, and reloading a gun never is! I actually developed the rifle for a revolutionary war game to make muskets viable vs. Indian bows and arrows. I needed them to be actually effective. The idea is to match the effectiveness of a bow in a gameplay perspective.
Firing a pistol, dropping it, and free-drawing a second pistol is totally bad ass though. It would be even more bad ass if it dealt 2d6 damage. : ) Ditto for dual-wielding revolvers.