DDS Errors

[kyandeisu]

Ok I have been searching the forums here, googling and what not to figure out exactly what is going on.
I am reskinning some DDS files (really any files from wings to armor to mounts and pets.) I get the same result.
I am currently using Photoshop CS5, with the DDS plugin NVIDIA v.823. When I save no matter what settings I have chosen (tried almost all possible ways of saving.) The alpha channel wont work at all, and completely make the image look like crap.
Image of my saving format:

Now before I upgraded to CS5, I was using CS3, and I believe it was with an older version of the NVIDIA Plugin. The only differences I can tell is that my plugin is a higher version (which shouldnt make a difference right? o.0) and that I am using CS5.
Here is an image of what my settings should of looked like before, believe I found this image off the forums here, but my older settings should of been pretty similar.
http://www5.pic-upload.de/25.08.10/hgh2uupjp3f.jpg

Has anyone used CS5 with version 8.23 NVIDIA and gotten the settings to work properly? Anyways, if there is an answer already posted here please point me in the right direction I guess I might of missed it if so.
^^ Thanks so much~

[MentaL]

[ronny1982]

recommend settings for export

• use DXT5 encoding
• use generate mipmaps
• use cubic filter for mipmap generation

fashion & armor don't support alpha, the alpha channel is used as

• tint map (fashion)
• metallic map (armor)

[kyandeisu]

recommend settings for export

• use DXT5 encoding
• use generate mipmaps
• use cubic filter for mipmap generation

fashion & armor don't support alpha, the alpha channel is used as

• tint map (fashion)
• metallic map (armor)

Thanks so much ronny! you always have the answers :)
Just have to test it later to see if it really worked, but from what I see and the looks of the alpha channel I believe it worked~