I've spent the last hour or so going through my skins folders deleting the skins I don't want/use anymore. Throughout the process, I noted that a lot of my jpg skins were never converted to .dds by LFS. Was this feature removed in a (test)patch at some point? I had to go through my recycling bin to restore several jpg skins as their dds counterparts were never created.

Bug?

Depends on whether you had low res skins enabled or not.

Quote from boothy :

Depends on whether you had low res skins enabled or not.

Not low res.

Compressed or full.

Full = JPG is converted on-the-fly
Compressed = JPG is converted to DDS BEFORE you use the skin.