Setup!
First i sugest you make a new folder and depending what you're working on you'll need certain files to get Model Editor to work.
Example: Female character
you will need-
mvr_female.chr (this is the file that will hold the skeleton and animation information)
Mvr_female_***.ani (these will be related animations attachted to the skeleton)
part_Female.o3d (this is the character model itself)
part_Female.dds (this is the texture file)
female is broken up to body parts: Hair/Head/Upper/Lower/Hand/Foot
to make things easier do the following, Make a new folder that will contain all female assests.
To not overfill your folder with every assest keep it minimal. I use basic animations for visual purposes.
(when file searching Model Editor has a habit of going back to the root folder you have the .exe in. so for simplicity sakes you can just drag the .o3d file straight into the program)

There is a lot to learn when it comes to doing your own custom models, depending on programs to the coding side of models.as I'm to believe there are bone files that allow you to go more in depth but I'm only here to show you a very basic be it messy way to get your own custom models in game.
These are ways i get around not finding many useful guides online..