bob, there are some issues with pcs autofacet and the specular effect, which cause rounded models to look faceted in game and this is odd. The only way to avoid this weirdness is to use cob2fs2 and smoothing.
Omni, I'm not sure if that version of cob2fs2 you used is the same included in modelview. BTW check Vasudan Admiral's signature. The file should also be in the wiki and probably in the descent network too. The most recent version of modelview lets you convert model from cob files, it can't convert shields properly (in my case at least, you have to import them from another pof).
About the smoothgroups...
As bob said, Truespace works with materials, where a material is a group of parameters (texture, bump mapping, reflectance, shaders etc).
If you change any of these parameters you change matarial.
So, you use a different material anytime you change shaders and/or texture.
Just open the material editor and create the material you want to use (texture + shader type or smooth angle), select a group of faces you want to be painted with this material, click on the paint tool. That's it
edit:
In theory truespace may recognize the different smoothgroups from 3ds as different materials.
If this happen, you don't have to select the faces you are going to paint, you can just create the material you want to use, use the paint over existing material tool (not sure about the name of the tool), click the mesh over one of the old materials. All the polys using the old material will be painted with the new one.
It is hard to see that you are using different materials if you are using the same texture, you may paint with a solid color to substitute the old material if you want to see all the polys that belong to the same material group.