Whats wrong with Milkshape? What error did it give you?
This is what I use
DBP for Programming
Milkshape for Models (20 bucks)
Lithunwrap for UV Mapping (FREE)
http://files.seriouszone.com/download.php?fileid=198
UV Mapping is the process of assigning UV points to a model, then exporting them as an image which you then paint the texture of the model on.
I then use Paintshop Pro (80 bucks, VERY cheap for the great features of this product - at Staples it comes with a 30 Dollar Mail in Rebate if you have some other products... it gives you a list) For Texturing
You can check out some of the stuff I have made at
The Eternal Destiny (My Teams Game) Screenshots Page
I did all the textures on the buildings, and on the one monster
I modelled everything you see there EXCEPT the Deen Model. Did all those models in Milkshape
RPGamer