I would use Blender(free), Truespace(free) and Gamespace(if you still can find it)

for animation and if you really need to use extra programs for animation then characterfx(free), fragmotion(cheap shareware) and milkshape3d(cheap shareware)
These tools would and should be enough to export models for your game worlds!!!
With Fbx and Collada being the exporters for animation!
3ds gamestudio, Torque and fpscreator(please more speed) would be the driving engines hahaha ;p There are other engines out there, but these will do fine

Cheers Moggy