Here is the problem laid out in visual format. Anybody know anything about this? Does Unreal just reduce the definition automatically? I'm trying to get the definition down to the pixel.
Looks like you were losing some of your highlights as well, though. Check your levels in photoshop for that texture before sending it to UDK. With the levels, make sure that the beginning and end stopper are at the exact beginning and endings of the incline and decline, to bring a little more contrast into the texture. This USUALLY works for most textures before bringing them into a game engine like UDK.
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