We'd still be a hell of a lot better off with something like 6mm PPC or 6.5x55 Swede(with not so long a bullet in the case). The trick is a low drag tip, high velocity, fragmenting round that can also bust armor. The last two normally don't jive with each other, but they can be made to, and in 5.56 they do indeed do both, but are not necessarily reliable enough. Honestly if stuck into a fight at 500+ yards with an enemy I'd take a scoped 8mm Mauser, cheap ammo, proven action, badass takedown power, and most importantly, it can bust cover and the wind doesn't blow it all over the place.
I know the 5.56 killed the enemy in Vietnam, but just look at how long the ROK guys carried Garands and BARs. Hell I even saw footage of US troops during the Tet Offensive carrying BARs, M-1 Carbines, Thompsons, and M-3s. Likely these guys were using whatever they could get their hands on (this footage was from some city battle, saw it on History Channel), but it worked just fine. I simply see no evidence that our lethality increased from the switch to 5.56, or that our suppressive fire increase made that much of an improvement.
A good handload .30-06 AP round can go through as much as 36 inches of solid oak. Try busting cover like that with SS-109. The enemy does not spend their time standing out in the open waiting for you to shoot them, they hide behind trees, rocks, dirt, animals, cars, aircraft, block walls, sandbags, kevlar, etc. 5.56 just doesn't cut it. We've simply not seen this yet because our only major conflict involving it was one we purposely lost and our enemy was decades behind us in logistical technology.
Gulf War? Hardly proof, the enemy surrendered like crazy and we did most of our killing with bombs, artillery, and tanks. 5.56 is a powerful round IF you hit the enemy in the right spot, and IF you hit them at all. Chechen Rebels have not had a very hard time making the Russians work for their victories and most of them are using 7.62, while most of the Russians are using 5.45. Logistics is what wins wars when you get down to it, not tactics, not bullets, those matter but logistics is the soul of a war machine.
Wounded are not enough of a factor to count on. If Russian war efforts during WW2 show anything, they show that getting your guys killed or wounded doesn't always matter that much to the war effort. If soldiers were wounded they were ignored until the battle was won or lost, and the thinking of the time was that instead of resupplying your own guys you give them all the supplies they can carry, send them to the front, get them killed and take some enemies with them, a nd then you don't have to resupply them, logistics problem solved. If they got wounded and survived the wait until the battle was over, then you'd stick them in a rudimentary field hospital and make a half-assed attempt to fix them up. In the rare chance they still managed to live, you stuck them back in the unit and got them killed in the next battle. Ruthless enemies don't sweat over wounded too badly, or dead for that matter.