Well, the ability has a "DamageAsDamageTarget" modifier for the 25%, which really doesn't clarify much, unfortunately:entityModifierbuffEntityModifierType "DamageAsDamageTarget"valueLevel:0 0.250000Still, if I had to guess from it, I would say it's more of a blanket damage increase rather than modifying mitigation.
The description is kinda nebulous and the devs really should clarify it better. If it is indeed a blanket effect, then it doesn't matter whether you use it against a shielded ship or not, you still reap benefits. Shields will drop faster and armor/hull will take more of a beating.