So I was looking through the TMD processing tool thread and I got this thought.
The way I understand that proccesing tool is that it can change from .dae(which can be opened in blender) to .tmd and vice versa.
Also JPOG animals have been imported into Zt2 so the opposite might be possible.
ZT2's animals skins use .dds like JPOG, but the models are either in .nif or .bfb
Both the nif and bfb files have plugins for blender, so I could be possible to open a ZT2 model in blender, save it as .dae, then open the .dae and save it as tmd. Noe I think the problem would be with the bones/nodes or whatever you call these things.