It saves smoothing groups IF you save in MAX files, ofc if you open SMD's you'll mess up the smoothness, but that's why You need a permission from the original author, to open the MAX file itself, milkshape doesn't have this problem because the smd importers are updated every time a new Milkshape version is developed, 3dsmax is alot better, no matter how, also I was giving information to comrade, I still prefer model swapping in 3dsmax, alot more control and a better program after all, that's why 3dsmax costs around 300€ and milkshape's licence is 25€ *cough*, I know milkshape is alot easier and all around a nice program, but let's face the facts, 3dsmax gives you more control over the situation, animating, modelling, texturing, real time flow, also I have 5 plugins on 3dsmax and 15 plugins on milkshape :P for Unreal plugins I only need 1 single plugin for 3dsmax and 5 for milkshape! I don't really care if 3dsmax takes time to load, Xbox360 takes more time to boot then PS3, You'll choose PS3? (I chose PS3 btw :P)
I'm making a FPS engine (C++) and I modelled a M14 on both, Milkshape and 3DSMax, and i ensure you, 3DSMax smoothness is gorgeous! Chamfer tool is easy to use and gives more control on the smoothness. Just saying I don't want to start any debate with this.
Nuf said.
lol. there is another way yo.
import the smd model, then convert as editable poly, then save it . voila. no smoothing errors