While I agree that more fine-tuning would be nice, I think the above suggestions (the ones that want change) are way overkill.

Would suggest just a couple things:

F8 - Behave as current.

Shift-F8 - Target nearest party-targetted monster; if no party-targetted monster, target nearest alliance-targetted monster; if no alliance-targetted monster, target nearest monster. Do not target NPCs or chests or whatnot. Character should not have to be facing the target in order for target to be found, but may want to restrict it to only targets within the camera field of view.

Ctrl-F8 - Target nearest NPC or chest or whatnot. Do not target monsters. Character should not have to be facing the target in order for target to be found, but may want to restrict it to only targets within the camera field of view.