I cant lie I got the grouping idea from eve online
Personally, Id love to have a large picture of my ship with blue-print style lines pointing to various sections with links such as "weapon systems", "engineering systems", "structural systems", "defensive systems", "sensors" etc... When you click them it would have a pop up that will be split into two. Top would be what all I have equipped and bottom would be my related inventory. I could then select or drag them to the top in order to equip. (from what I understand this is not a flash based app, so the dragging might be an overkill X_x)
Making icons smaller would make it easier if combined with an ability to expand the "info" showing you the large icon and details of item...