I don't do much repainting but I've never had a problem with DXT3 textures in FS2002 or FS9. I'm wondering if it depends on your video card, FS display settings or maybe the material/texture properties of the specific model. There must be an explanation. If in doubt it stands to reason that, if the original textures display properly on your system, saving edited textures in their original format should work.
PS. As an experiment I downloaded the Iberia MD-87 & the repaint kit. The original Iberia textures are in DXT3 format without Mips. I tried a simple repaint saving out in the same format with & without Mips. It displays fine for me in both formats (better with Mips if anything) so I suspect this depends on the video card. I also added Mips to the original DXT3 textures with the same result. I haven't tried 32-bit yet.
The problem with giving any advice/suggestions these days is the increasing number of variables. Everyone's system is different in some way & the graphics quality is affected by the OS, type/make of video card & FS display settings among other variables. The FS9.1 update complicates things even further. I'm using an antiquated Voodoo5 5500 video card on WinMe without the FS9.1 update installed. What works for me will not necessarily work or be ideal for others & vice versa.
