I finally found a way to convert the models made in Blender into mdl7.
Exporting the files into wavefront format enables me to import the model to mdl7 with textures and materials included.

Here is picture of a model I just published at turbosquid:



I will make a little game level and check how it looks in Gamestudio.. I'll publish a screenshot later .. so the next model pack will include models made in Blender in game-ready mdl7 format free for you.