I've tried using DirectX Texture Tool and ATI Compressonator to create a DDS from "grassB.bmp" from the "textures" folder. I compress it at DXT1 and generate mipmaps at 1x1. The resulting texture simply does not display properly when applied to a map block, in WED or the compiled level. Is there an option/commandline setting I'm missing somewhere? I'm running under A7, WED 6.835, Commercial.

EDITTED: AFter further tests, models with DDS skins seem to work fine, but DDS as level textures don't. The manual leads one to believe that they should. Perhaps it is best to say, "WED supports models that are skinned with textures in the DDS format." There is a substancial size reduction between BMP and DDS.