The factions will keep on fighting regardless if this mod is active in the save or not.
The file this mod changes is only accessed at first contact after all.
The violence comes from the game's Aggressive trait not this mod. So your only option is to find a way to edit the traits of a pre-existing faction and remove that trait or find/make a mod that disables the invasion feature. Thus enforcing the cease fire I think you want.

Will unsubscribing the mod will make the affected factions cease fire or it will still be in effect?

It can't be mine since this mod only messes with the factions.lua file and I know that file only controls faction traits based on the name chosen. So it would make no sense for this mod to be responsible. If it is then that must be quite a strange bug in the game for something like that to happen.

Does this mod in anay way affect wreckages? In my game wreckages of ships (of any faction) that were just wrecked will, either right away or pretty soon after I start salvaging it, start having small explosions around it for about idk 15-30 seconds and then the remainder of the wreck explodes and disappears. I'm not claiming this is from your mod. I'm just trying to narrow it down and neither of the Discords has been able to shed any light even with a list of my mods.

Well I doubt you will ever see this but I just found the code that influences how often a faction attacks. Still clueless about the truce part but I imagine it is in a similar location. I just made a mod that made the chances of a battle happening being bumped up to 100% provided you meet the other requirements for an invasion to happen.

I do not know how often it happens, I find it to be quit random and I am sure I can't find out because I do not know if that part of the code is accessible for modders like me. All I know is factions will only attack sectors within a certain proximity of their own.

In terms of truces, I suspect they only make truces when you ally with both factions, but I have not tested it. I just remember not seeing any battles after a certain point in one of my games after I allied with both sides. Beyond that, it is a war that will only reach a standstill if the gap between the faction sectors reaches a certain point. (I do not know this number either, best chance of finding out is to just keep tabs on who attacks who and how far away that sector is from the attacker's one)

How often the factions will fight each other? Is there any chance for them to cool down and make a truce in every few times?

Ok mod is updated. It should continue to work until Avorion reaches version 10.0.0 or the creators actually modify the faction.lua file in a way that makes this mod break the game.

Yep, it works just because it is such a simple mod that modifies the a file the creators will rarely change.

I will have to update it anyway just so the subscribers don't have to force this mod to be enabled just because the mod file has an update version number cap of 1.3.8 and now we are at 2.0.6.

any word on if this works still in 2.0?

This mod does not mess with the ships directly or at all technically.

Instead it messes with the faction upon that faction's creation by forcing that faction to adopt the aggressive trait at its highest level. The game then just makes that faction's ships behave like an aggressive faction ships should and attack all hostile installations in the sector.

How does this mod interact with others that modify ships?