why are you using pcx and ani instead of dds and eff?
(...) DDS may work, but you run into quality issues with compression (eg. DXT1), or large file sizes without RLE compression if using something like 8888 DDS.
Those issues can be controlled surprisingly well if one knows what they're doing. Zacam knows a lot about DDS file format and how to use it to it's full extent with minimal quality loss from compression; choosing the right format is the first step, the second is managing the conversion and compression so that quality loss is minimized... I myself don't know much about it; if nvDXT can't produce a good quality version, I usually just resort to u888 or u8888 DDS files if I' just fooling around with things, but their large filesize isn't feasible for distribution... For example, Zacam helped a lot in making a high quality DXT5 compressed version of my blue nebula skybox texture, while my compression tools kept butchering the quality quite atrociously.
Performance of DDS over TGA doesn't matter too much in the interfaces, I don't think. In any case, imagemagick can convert from DDS, but not to DDS (as far as I know), which means a modder will have to use an alternate means of converting the 963 interface images to DDS, which I don't see happening.
In a case where you cannot use compressed DDS files for some reason, you should prefer uncompressed DDS files (u888 for files without alpha channel, u8888 for ones with alpha channel) over TGA files because DDS files will be handled better by the game than TGA files due to the fact that they are designed for gaming graphics use. Even uncompressed DDS will have some performance benefits over TGA files.
As to how to convert multiple files into DDS - batch conversion FTW! You can use for example NVidia's DDS Tools, which has a command line utility called nvDXT and it is used in this fashion:
C:\ImageDirectory>nvdxt -file <files to be converted, for example file1.tga,file2.tga or *.tga, or file****.tga> <DDS compression format; DXT1c, DXT3 and DXT5 are the ones most often used in FS2_Open; then there are u888 and u8888 and DXT5nm... but the last one is a bit special case> <compression quality> <mipmap filter> <other assorted stuff; read the introductions>
Example for converting all frames in a directory into DXT1c compressed DDS files with Gaussian filtered mipmaps would be
nvdxt -file *.* -dxt1c -quality_highest -gaussian
then it will do it's magicks and you'll end up with the frames.
Of course, mipmaps are more or less ballast on the interface static images, and you would probably be able to detach them from the files and only use the primary resolution layer, reducing the filesize even further...
I'm not sure if tools like IrfanView can deal with conversion to DDS files, haven't really used that one very much myself but it might be worth checking out if you prefer graphical user interface to command line (I myself don't really see reason to do that unless you get a high quality preview window of the resulting file with given settings...)