I think that Unity could be your best bet. It may take the pro version to get some things, but in general the problem with visual in Unity isn't Unity itself, rather the art assets that people have/don't have. There are some things that UDK can do that Unity can't, but it isn't THAT much of a difference at least in my opinion. In Unity, you still have access to shaders, including your own if you can write them. I think Unity's particle is plenty good for explosions, but you have to use good particle textures or it won't matter what engine you use. Also, scripting code in Unity is actually likely to be faster running than unrealscript(have seen things online confirming that unrealscript is really slow) so you can also code things if you need to do something that is out of the box, and that is how many of the things in the asset store have come about.
I'd say that generally, once you get to a certain point, the engine no longer creates most limitations. For example, the Irrlicht engine has some pretty stupid limitations, like no normal mapped shaders on anything that is animated(due to not having a proper vertex format backend to rendered models), or also a lack of animation blending, or similar things. Unity is for the most part beyond those limits, and at this point it depends on your art as the engine itself is no longer a limiting factor. of course, this does assume you have the pro version.
As far as using the UDK for this...I'd say it is a worthy contender. It has certain things it does better, but it isn't suited to the game type you want. It also has the advantage of being free to use during development, only $99 to use commercial, and only paying the 25% royalties when you get over $50,000 in earnings. This scheme is better for some people, as you get all the features for next to free up until you have enough earnings to not care as much about the 25%. I'd say if UDK enables you to make your game, then it is very worth the royalties. Also, the $99 to start with is much cheaper than the $1500 for Unity Pro. On the other hand, some people prefer to pay the $1500 up front and never risk paying royalties later. The other thing to remember though, is how likely is it that you would reach the $50,000 to have to pay royalties if you used the UDK anyway? This is really another discussion though, but it is something to think about. In the end, this isn't the only thing that would help with a decision, but it is a start.
