Why can't i pick up ammunition on certain parts of each stage, from chapter 2 and onwards? I've got room for more ammo, but for some reason a red line is shown across it, therefore making it unequipable
You have limited inventory spaces, ammo takes up space in your inventory like every other item - herbs, grenades, health spray, etc. Each ammo/grenade type can hold up to a maximum amount for each inventory space, afterwards it'll take another inventory space. Check your inventory (Trinagle on PS3, I assume Y on xbox 360) and see if you have any open inventory spaces. If not, you can choose to throw away some uneeded stuff, but try using your inventory before throwing stuff away (for example, combining/equipping herbs, reloading weapons, etc.).
While it may seem your current weapon's clip still has space for more ammo, you cant reload directly from an ammo drop, you need to be able to pick it up to your inventory, then reload.