I've recently saw this export option: "Unreal Engine 4 (packed)". What's the purpose of it? Does it have any effect on runtime performance, or is it there just to save on filesize? Are there any trade-offs with this?
Something like that. I'm not really a techincal artist myself so I can't really tell you from the top of my head. I guess there are pretty good topics here on polycount that covers this more in depth since it's a pretty common thing.
Its useful for several thing, for example, I personnaly often blend my IDs outside of Substance Painter, and having less maps to manage is usually pretty handy. And as you said, it also takes less memory, but also less hard drive space. But that's just how I understand it.
Not at all, since only the AO/Roughness/Metallic are packed inside the same Map. The normal map and Base Color are pretty much always on the own. Even so, packed textures do not lose any resolution since the informations are packed inside the RGB channels.
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