An explanation of my testing methodology to determine that Strafe is indeed still penalized, sorry for the wall of text. 
Copy pasted from my Reddit post:
How do I know for sure that it’s not working as intended?
I did some testing. Sorry for the horribly convoluted method, I’m sure there’s a much easier way to test it but I’ll explain what I did.
In monstats.txt (handles monster statistics):
- set “enabled” column to 0 for fallen and quill rats (prevents them from spawning)
- set “AI” column to “Idle” for zombies (prevents them from moving or attacking),
- set “noRatio” to 0 to disable it (noRatio is a column that affects how monster’s baseline stats are calculated like life/damage, etc)
- set "MinHP(H) and “MaxHP(H)” columns to 5000 for zombies (this is why I disabled noRatio, otherwise they wouldn’t have 5000 life exactly)
- set “DamageRegen” column to 0 for zombies (prevents life regeneration)
In skills.txt:
- set “Param3” and “Param4” columns for Strafe to 1 (makes Strafe always shoot only 1 arrow)
After that I created a hero edited amazon that has these stats and items:
- 4000 current life and 8000 maximum life
- No allocated stat or skill points (500 available stat points and 200 available skill points, both for testing purposes)
- Plain short bow (1 - 4 damage) and arrows
- Small charm with 49 minimum/46 maximum damage
- Small charm with 50 min/50 max damage
- 6x small charms with 100% life steal each (600% life steal total)
Testing methodology:
My bow and charms give me a base damage of 100-100 (min: 1 + 49 + 50 = 100, max: 4 + 46 + 50 = 100).
I allocate points up the bow skill tree until I have 1 point in Strafe, which has 20% enhanced damage (5% from Strafe, 5% from Multiple Shot synergy, 10% from Guided Arrow synergy). I allocate 55 points to dexterity giving me 80 total dexterity (25 base dexterity). This gives me exactly 100% enhanced damage when using a bow, which increases my damage to 200-200.
Zombies have 50% damage reduction which would reduce my damage to 100-100, which means it should take exactly 50 hits to kill them. I also have 600% life steal which is reduced to 100% by the Hell penalty (1/3) and the zombies “drain effectiveness” stat (50%, which means life steal is half effective), so I should leech exactly 100 life per hit as well.
I shoot a zombie with Strafe and I only leech 56 life, which is consistent with the 3/4 penalty which also applies to life/mana steal (100 damage * .75 = 75 damage, 100% leech * .75 = 75% leech, 75 damage * .75 leech = 56.25 life returned). I continue shooting the zombie with Strafe until it dies, which takes 67 hits (75 damage * 67 = 5025 total damage).
Then I switch to Guided Arrow which has 12% enhanced damage, so I allocate an additional 8 dexterity (88 total) so I maintain 100% enhanced damage. I shoot the zombie and leech the expected 100 life and it takes exactly 50 hits to kill it.
Testing changes to missiles.txt:
After performing the above tests and determining that Strafe is still penalized, I adjusted “SrcDam” of “strafearrow” in missiles.txt from 96 to 128 and performed the tests again (I respecced the amazon so that the additional 8 dexterity doesn’t throw off the first test), and Strafe dealt full damage as intended, 100 life leeched per hit and exactly 50 hits to kill the zombie.