Im sorry to be the one to say this, but this thread is full of misinformation. While a shooting range can make up whatever rules they want, (and the members must follow them), the "no steel core" requirement by indoor shooting ranges is complete BS. I think this nonsense spawns from retarded politicians in US that banned mild steel core ammo under the premise that it's "armor piercing". The steel core in surplus ammo is a cost saving measure. Its NOT designed to have better penetration at all. Any high-velocity rifle bullet would've done the exact same damage to that plate. I'd be willing to bet that a hot, lead core .223 or .243 will cause more damage than a steel core 7.62x39. The reason that plate got chewed up is because you didn't spec the requirements properly to the supplier. Either that, or the specs weren't followed. An AR500 target MUST be water jet cut. Most steel places don't have a water jet, and they use a plasma cutter. This ruins the temper of the metal and makes it soft on the edges. As a result, its no better than mild steel near the cut, and any high velocity rifle round will damage it. I have an 8" gong made from 3/8" water jet cut AR500. It has taken hundreds of hits of steel core 7.62x39 and there is absolutely zero damage. The only damage on the gong are tiny craters left by lead core .223 @~3300fps.
The only logical reason that I can think of to disallow mild steel core ammo at the ranges is to prevent people from using actual ARMOR PIERCING ammo. However, considering the availability of true AP ammo, I highly doubt that anyone would ever attempt to use it on an indoor shooting range, even if mild steel core ammo was allowed.