you said the models don't seem to be changing... that could be that the LoD distances are too far and aren't really doing much. LoD distances can be set via code (do a search; sorry but i dont have access to it at the moment) and for testing purposes you may want to change the colours of the skins of different LoDs to make the change obvious, and then change them back when you are satisfied with your settings.

the manual also has a page on optimising code. it just tells you what to avoid and what alternatives can be made (for example, bones animation is slower than vertex, so if you have a huge amount of characters on screen, use vertex animation).

julz