Creating .DDS files for torque 3d

#1 For alpha transparencies use DXT5.
DXT5_NM makes nice normal map will DXT5 can mangle them with it's compression.
For no alpha then use DXT1.
Always use mipmaps and I vaguely remember an old thread from the days of TGEA that said set the mipmaps blur to -2. I think everything else are stock settings.

#2 I usually do some hand-tweaking of mipmaps in ground textures after the mipmaps are generated... sometimes the dds plugin seems loses more detail than I would like. The dds importer/exporter will allow you to import a dds with the mipmaps and save them back out again. I found that by basically creating my own replacement mips from the original image, scaling it down, sharpening, and replacing the existing mip, I could create crisper distant textures. Don't make them too sharp or you'll get a lot of "sparkling" in the distance. Just something to maybe play around with.

If you can get a level of sharpening that you like on everything, you could even create a Photoshop action that does it automatically. Create a droplet for it and it could be a pretty simple part of a pipeline.

#3 DXT1a is small but it leaves compression noise. Not really recommended unless you have a limited color palette and want to squeeze out some extra space. (DTX1c I dont really recommend at all)

DTX3 is decent enough for most colour images. Still only has a limited 2 bit alpha option though.

DTX5 looks the same as DTX3 with regards to RGB, big difference is a full 8 bit alpha channel.

DTX5_nm is used only for normal maps and will help not lose colour depth with equates to normal information.

Be careful when you save your DDS files that you dont accidentally save Alpha channel data if you arent using it, it can result in unnecessary bloat in the file.

The biggest benefit of DDS is the fact that the data stays compressed (as you see it in the bitmap format) in memory (unlike other compressed file formats, which are stored raw in memory). The biggest failing of DDS is compression artifacts which dont quite give you as rich of a colour output (which is why alot of engines are really enthusiastic about using TGA).

#4 Steve, Russel, Logan thank you ALL SO MUCH FOR YOUR HELP !! I was able to get the dds files to work correctly diffuse, normal, and specular. My only thing that I am noticing is that it seems as if my normal map is losing a lot of height information within torque. I understand that rule of thumb is never believe that the high quality view in maya is what you will be recieving also when importing meshes into a game engine but it seems like a lot of my rgb info is either being blurred or the lighting is so horrible that it is not catching any of the height info for the normal map. I was going to go back into photoshop and load my dds with the mip maps and edit each individually but i thought i would ask if thier are any sort of settings with the dds exporter for photoshop that i should tweak upon exportation. I am putting two files that shows the maya and torque comparison screens.