Jaw Dropping looks is often a powerful reality.
An initiative penalty feels right to me. Perhaps actual penalties on some sort of critical failure.
I think the tricky part is that some are very succeptable to it, while others either deal with it, ignore it, or even react negatively.
So I would worry more about who is effected and how it is perceived.
My rules system, especially in combat, makes an action quite quick, normally, so the resultant fumble and forfeiting the next action totally (meaning the would-be attacker instead just stares at the unerring one), feels quite proper in this case (all fumbles result in forfeiting the next action, by the way, and there are no critical failures in this system).
I have an idea that the Leadership skill may be used to override the unerring effect, but i'm not quite sure how, yet, especially since i avoid adding extra die rolls.
One may also think of a kind of Moral Guide value, that some may have, that also may override the Unerring effect.
The "react negatively", however, is the most problematic one, because if one also gett immune from regular Unerring, then one should have to choose something else that causes the same Unerring-effect instead.
As it currently is, Unerring is caused by things that is "sexy", as well as references to S/M and a certain fetishism.
But, if those do not causes a jaw-dropping and staring, then what does?
Uniforms? Armor? Badges? Nakedness? Peasant outfits? Peasants? Monsters? Mud? Dungeoncrawling? ... i think you get my point.
As for the mechanism for "react negative", i think the result would be that the double Unerring is added to the Damage Roll, the first to negate the effects, the second to account for the notable dislike.
... or just negate the Unerring, and add +1 to the Damage Roll.
Also, i think it may be best to put some limit to how much Unerring a caracter can amass ... + that one must remember how well it may work with the intended character.
I think the most Unerring i ever gave to a character, and that was in a miniatures game i made based on the same rules, was 3, and usually, the max was 2.