Using assets from other games is cool but games don't make their assets in the same ways. Different file formats are solved by importers but we need something else to make the assets "fit in" with Sandbox.
It's probably worst with models because they can use a completely different scale, orientation, and pivot point (center). For example you might need to scale up a model 1,000x before it's a decent size in game. We could just scale up the entity and that would work but then anything attached to it will inherit the scaling.
The settings are all 3D vectors if you wanted to stretch something just to make it fatter or whatever. Origin is the pivot point and 0.5 just makes it use the center of the mesh. Also, any of these can be left out to use the original model's properties.
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