Not sure if I'm understanding this correctly: It seems like the melee build took a brutal nerf in 1.3. Hit and Run and Fancy Footwork now grant about half the MP, while the minimum AP cost increased by 1, reducing damage output opportunities by nearly a 1/4. In comparison, the reduced damage bonus from skills seems insignificant. Is pure melee build even viable anymore?
In short, yes.
Though it depends on what you mean by "pure melee" and "viable". Melee without using any psi, traps, or grenades has never been practical, and any build that does use them is gonna work fine.
I've played melee builds that didn't include Hit and Run or Fancy Footwork, and only 50% of melee builds use DEX over STR, so those aren't affected by the minimum AP cost changes.
It's a significant nerf for sure, but unless you're on dominating and really wanted to play a non-psi glove or knife build, I wouldn't worry too much about it.
Also, Hit and Run and Fancy Footwork haven't had their movement points halved, they work exactly the same way as before the first time they get activated in a turn. Fancy Footwork can only give 36 MP without specialization, and 55 MP with it. That's obviously worse than before, but that's more MP than Sprint can give, so it's definitely worth taking. Not sure how the rounding works for Hit and Run, so I don't know how much MP it can give per turn, but it's never been as consistent anyway.