I just got back from that underground lost city, and all of a sudden, I can't equip any items. When I press a number hotkey, nothing happens, and when I use the inventory to equip an item, nothing happens. Is this a bug, or is this intentionally this way?

Its a bug, if you drop everything in your inventory then pick it back up you'll be able to use it again.

I believe it's a bug from the original Deus Ex, not related to this mod.