I have been working a lot with dds textures. Been using the nvdia tools to save directly as dds. I have always used DXT1 for just standard textures on models. And DXT5 for textures with alpha channels. But is there really a difference in using the other methods? Like dxt3, 8, 8.8 etc. Does it matter for use on models? Any guides, on what method should be used for what purpose? I am making textures for use on models to be used in a 3D game, some with normal maps and specular. Some without.

There's good information at the wikipedia page. Basically, DXT2/3 is useful if your texture uses alpha for shape with sharp edges, and DXT4/5 is useful for more gradually varying alpha. BTW, I've personally never seen DXT2/4 in practice.

Ah, that's good information thanks.

Seems that there's no problem in the current textures I've done. :)