I've written a tutorial on how to get a simple prop from XSI into the Source Engine. This guide uses the free Mod Tool for exporting a model, and properly explains the process of compiling a model and material for Team Fortress 2. But the method can be used for any Source Engine game. I wrote this as a quick reference for…
Vig: This is only a simple prop with no animations. So exporting an SMD from Max should be easy enough. Create a mesh, UV map, apply an image, export as SMD model. From there, the instructions in this guide can still be followed. I'm willing to include tips for Max and Maya users if necessary. I used the Mod Tool for this…
Small correction made. Only Steam is required to be running to compile models, not Source SDK. Made changes due to this. Also, thanks for the comments. I'm in the middle of writing the follow up to this, which will explain using simple bone animations, and triggering them in game.