You should use the fewest entities you can. For maximum efficiency, have your models between 3000 and 6000 polygons. That is, if each tree used 10 polygons, have 300 trees grouped up in one single MDL file. I have yet to devise a way to find out what effect using multiple entities actually has. That is, if you add one entity, it simulates having to render another X polygons. Vertices also play a big role, even bigger than polygons.