Ummm, close combat shot at second level seems very broken. It usually takes an epic feat to do that. I would suggest putting a minimum level requirement before you can pick it, at least.
Maybe give at the first choice, +4 AC vs. AOO's for shooting in melee, then no AOOs for advanced. That seems much more balanced. Just my opinion though.
I'd say more that the epic feat is horribly underpowered rather than that the ability is overpowered. I mean, you can negate AoOs in archery just by taking a 5-ft step. I'd certainly never waste an epic feat on that, and even with the ability as is, I don't think I'd take it over something like Master of Serendipity.