By RAW:
Combat turn order is:
- Test for surprise if applicable
- Test for initiative
- Go through Initiative Passes in order
The surprise test happens as soon as somebody tries to do something with the intent of surprising another. The sniper tries to surprise the victim, so he initiates the opposed roll, and starts "combat time". They're never made after an action has been used. The surprise roll is a normal initiative roll, with the sniper getting a +6 for ambushing, and the victim getting a +3 for having been alerted, IF he made the extremely hard Perception roll to spot the bullet, or got more than one (I'd say 2) net hits on the even harder one to spot the sniper plain out. One net hit on the last test would yield something along the lines of "you see the outline of a person standing in one of the second story windows of the house about a mile away." That would in no way be of any help as there is no cause for suspicion, other than the GM mentioning it. Three or four net hits might result in something like "the person is aiming a ruthenium coated rifle in your direction." The latter would rule out surprise.
Would the victim fail that roll, he is unlikely to survive the shot as he can't defend. If he does, they roll off actual Initiative, the sniper's action is shooting, the victim's options depend on if he wins initiative. If he doesn't, he can go Full Defense. If he does, he can do anything he likes, getting behind cover would seem smart. Through some flux in space/time he thereby probably prevents the sniper from shooting. Note that even a single step would be enough for the sniper to have to lock on his image mag anew. If Mister Perceptive would be properly geared, he could conceivably shoot back twice, then run for cover. He could give the victim a shove, or catch the bullet, if he wasn't the victim himself. Figuring out who is the victim might be handled by the perception roll made earlier.
RAW suggests he could drop prone if he is surprised, but wins subsequent initiative roll. I'd say this is reacting to the sniper's action though, which makes it unRAWful. I don't have a clue what that passage is doing there and how dropping could be construed to not be reacting to someone.
And no, I agree. It doesn't make much sense, but unless I'm doing more fail, that's how it's handled by RAW.