I think the settings are saved in cfg.txt. Do you have by any chance delete this file by mistake.. Or another way to save time adjusting your settings everytime.
1. Make the settings you want
2. Close LFS
3. Copy and paste the file cfg.txt - When pasted new file name - "cfg - Copy"
So when the settings get resetted to default you can overwrite the cfg.txt with the copied one.
I don't know why it's happening. This is the only solution I could think of. Maybe this is not an real solution but its an solution at some point. At least you can save time adjusting the settings.
So this will be similar to the downloading skins from the master server I guess. But will there be an option for us ( the mod creators / publishers ) to have the textures at higher resolution ( 4096 x 4096 ) locally.
Like skins - When we are creating skins its ususally 4096x4096 and we put it as .JPEG in our data/skins folder.
When we upload it to the master server we downscale it to 1024x1024 so it fits the requirements for upload.
As far as I undestood the Mods are for only S3 servers / S3 Licensed players. Also there will be an option if the server supports the mods or not.. Something like /mods=off , mods=on.