I was checking into this idea that freefalling bullets kill, when I ran into this thread and noticed your experiment. There are a few things you didn't take into account. One of them is in regards to the (spin end over end) when releasing the bullet. It is important to note that you released the bullets when they were already falling at 120 MPH, as opposed to a bullet that reaches it's highest point and begins to drop from zero velocity. A bullet drop from zero velocity will have a much greater chance of becoming stable and drop with the base of the bullet facing the earth, than one released from a standpoint of air passing it at 120 MPH. If you let go of the bullet at 120 MPH, and if it isn't in what would be a stable position to begin with - It will spin end over end from the start with perhaps no chance of stability before it hits the ground. In effect you lose perhaps 50% of it's potential velocity from the get go. A more important point to be made is your body dropping next to the bullet is contaminating the experiment. When you are in freefall - There is a greater air pressure created below you as you drop, while you in effect created a sort of vaccum above your body. This creates a sort of wind tunnel around you. I.E. The air below you rushes past you to fill the vaccum above you. Although you may be dropping at 120 MPH - The air around could be passing at say 180 MPH in relation to you. So the bullet could be dropping at 180 MPH in relation to the air thats moving at 60 MPH to fill the vaccum above you. Hence - You will see the bullet as if it is falling slower than you, when in reality it's moving 180 MPH in relation to the air. When the bullet gets to an area of calmer air ( away from you). It will accelerate in relation to the calmer air. It could concievably catch up to you if it could fall away from the disturbance you created during your fall. If you put the bullet on your back side - It should stay there. considering there is a bit of a vaccum there. I'm guessing bullets will drop anywhere from 150 to 300 MPH, and anything above 200 MPH has a fairly good chance of taking you out, should it hit you in the noggin.
