"Editing" other people's models is a touchy subject.
If by "editing" you mean repainting, then that's just opening textures and working with them.
If by "editing" you mean affecting the flight dynamics - giving it better/more accurate performance, that involvesworking with just the aircraft.cfg and *.air files, both of which can be changed with a text editor (aircraf.cfg) or a freeware utility for thej *.air file- (AirEd, for example)
If by "editing" you mean changing the model's visual appearance, removing/adding a second pilot, changing the visual so it resembles a different variant (i.e. a Spit 9 from a normal Malcol hood to a cutback bubble canopy), then you're getting into a very touchy area.
There are utilities that can convert an older style MDL file (pre-gmax, FSDS2) to a 3D model that can be opened in gmax, FSDS, etc. However, you end up having to rename, reanimate, retag, retexture the model, apart from having to respawn the model. There is so much work to be done that if you can handle gmax/FSDS, you're better off building the model from scratch. In this case, you're better off looking for a similar source file and working from it. Sometimes the original builder will gladly provide the source file if you propose the change(s) you plan to do, and of course, give proper credit.
How do people edit other peoples aircraft then? Is there no way to open an MDL file in another 3D viewer like PPE that can save to other formats?