The trick with the texture is diffuse light baking, done in for example 3ds max? Or is there some raytracing function in the engine (baking done within the engine, like UDK)?
almost all game engines olny use png or tga, for getting content into the game engine, once it is there it is usually converted to dds, and gets mipmaps generated for it.
What game engine is this? If it's a custom engine, talk to your graphics programmer. It's probably the tangents or bi-tangents getting messed up somewhere in the shading pipeline.
iirc quake and the engines derived from it such as goldsrc and source always had changeable fov. So it seems the problem isn't the engine. But descions made by the dev.
It's running on Unreal Engine 3. https://twitter.com/MarkRein/status/209904125813587968 But I really doubt anything from rendering part of engine left here.