The engine you choose usually has an option to use a sprite sheet instead of individual images.  Then you simply tell it how many lines and rows the image has.

What engine are you using?

I found some random placeholder objects from old projects if anyone is interested: http://opengameart.org/content/low-poly-set-dressing-pack

I'm still working on the ship.  Hit a snag when I realised my zBrush is still on my old machine.  XD  Hopefully it will be finished soon.

Sweet!  Even if you can't get all the pieces done in sketchup, you're still making progress!  Plus it's a good idea to have a prototype of the game done first anyway.  ^^ Sounds awesome.

It's good to limit your bones for unreal to 2-80 bones (average is 30).  Yeah, only 1 root bone is allowed.  It sounds like your dog rig might be too complex for the game.

"Ureal is also Incredabily fussy. If people haven't set up their models right"

This pretty much defines my life right here. XD

Sure!  I'll start on it after I'm done with ship1.

Also, note that it would be a non-exclusive license, meaning that other people would be able to dl it and use it too.  Is that ok?  I know you said it's open source, but I want to make sure with you first.