I think Morale does effect fighting: I was building up a Pistol level in the Caves of Padres del Fuego with a Character with 76 morale. My hite rate seemed like 50%, every other shot was a Miss or Dogged. I went back to the same area with another character for the same reason - both characters pistols were at the same level, with same shot. Only difference was the second character had a Morale of 96. Only 1 in every 6 shots was a Miss or Dogged this time.
