The ins and outs is that T2 (gun) ammo have higher damage but penalized tracking, while Faction (gun) ammo have still reasonably higher damage but without the tracking penalty. along with the usual range bonuses/penalties.
So if you have no problems tracking your target T2 is what you should be using, on the other hand if you do have slight trouble tracking then you should use Faction.
That said, there are other ways for you to increase the chances of your guns hitting the target:
- Webifier(s) - Reduces targets speed by around 50-90% depending on module and ship it’s fitted to. Limited range, 10+ km.
- Target Painter - Increases the signature of target ship by a percentage. Long range, easily 90+ km