I like the idea of making destructible torpedoes detonate when hit mid-flight.
I don't like the idea about "once they traveled 10 kms, have torpedoes disappear": essentially is like asking for Escorts to be able to outrun torpedoes...
Besides, I think all torpedo weapons should travel much faster than they do in game - shooting an incoming torpedo should be a matter of quick reflexes, instead of "oh, a Tricobalt...I'll shot it down after I finish my coffee!"
While in reality it may be the case, although not a given, that shooting down a missile or torpedo causes it to explode, I don't think it would be suitable for gameplay here, especially in a PvP environment.
It would actually make certain torpedoes a liability to use, I don't think that is a good idea. For every instance you are imagining said AOE hurting your enemy, it may end up hurting you and your allies just as much.
This is one game where I don't feel friendly fire is appropriate.
Edit: Also, it punishes players for no reason. A number of things can set of a torp in your scenario; a fighter, faw, csv, psw, gw, automated turrets, to a name a few. Player X can launch a torpedo at player Y and through no fault of their own player Z can suffer from the result of it being shot down. I don't think it is acceptable for players to risk dying through no fault of their own. You should live or die on your own intentional actions and the intentional actions of your allies.
Without friendly fire accidents possible, I'd be very much for it. Targetable Projectiles are too easily intercepted.
My only issue is they are too slow in game, although in reality they still are probably doing close to a good 1km/s, which is pretty nippy. I don't see the need for them to be much slower than photons.