Next Test ... step by step as I do it :

The test model was 'mount_heavy_horse_lod0.mesh'. It was converted into an MS3D file using converter version 1.04, and the resulting MS3D file was opened in milkshape. The bones were 'zeroed' and the file was saved with the bones set at zero rotation.

Next, the skeleton was extracted using the latest release ( 1.1 ) of the utilities. The output in the skeleton file looks like this:

Code:
+0.0000000000  +0.0000000000  +0.0000000000    0  bone_H_Saddle
-0.0001452830  -0.0151966996  +0.4446060061    1  bone_Spine
-0.0006578590  -0.0245500989  +0.4198270440    2  bone_Spine1
-0.0008467390  +0.0139799975  +0.5470259190    3  bone_Neck
-0.0071678599  +0.5777239799  +0.4736510515    4  bone_Head
+0.2537220120  -0.2715969980  +0.5931140184    3  bone_RightArm
-0.0000306070  -0.3205270171  +0.0193389654    6  bone_RightForeArm
-0.0000488162  -0.4961239696  +0.0302742720    7  bone_RightHand
-0.0000340939  -0.3660830259  +0.0222389698    8  bone_RightFingerBase
-0.2555060089  -0.2715960145  +0.5923159122    3  bone_LeftArm
-0.0000304878  -0.3205200136  +0.0193104744   10  bone_LeftForeArm
-0.0000469685  -0.4961230159  +0.0303035975   11  bone_LeftHand
-0.0000362992  -0.3660819530  +0.0222394466   12  bone_LeftFingerBase
+0.0002688530  +0.0194744002  -0.2931849957    1  bone_Tail1
+0.0005695900  -0.3195210099  -0.3636940122   14  bone_Tail2
+0.2247990072  -0.2321140021  -0.1584759951    1  bone_RightUpLeg
-0.0000070184  -0.3785619736  +0.0039954484   16  bone_RightLeg
+0.0000009686  -0.4450979829  +0.0000083745   17  bone_RightFoot
-0.0000018179  -0.6024720669  -0.0000081211   18  bone_RightToeBase
-0.2339520007  -0.2229759991  -0.1583569944    1  bone_LeftUpLeg
-0.0000050515  -0.3876999915  +0.0031598955   20  bone_LeftLeg
+0.0000087619  -0.4450979829  +0.0000056773   21  bone_LeftFoot
+0.0000151992  -0.6024720669  -0.0000081062   22  bone_LeftToeBase
Looks fine so far, and this is correct with regard ot my understanding of how the thing should be built up

Next, being completely happy that my base MS3d file is a good one, I run the animmerge, and choose the solid MS3D file and .... for preference ...the 'run' animation for the horse. All animations were given the 20 frames per second option in the dialoge box.

The resulting MS3D file is called 'mount_heavy_horse_lod0_animby_fs_fast_horse_run.ms3d' and opens up fine in milkshape and the animation plays just fine.

Next ... I run animation extract. No actual output is created, but there are error messages in the DOS window.

(hope that has come out clear enough to be helpful)

This was run using a 100% stock model on a completely stock animation, with the latest animation toolset.

When I try to run a similar process for the elephant ... animerge fails and I cannot create an MS3D animation file to look at or convert back. Error in line 525 ... with a 'list index out of range'.

Camels convert to and from CAS file perfectly, though the gallop file I created went from 5Kb to 8Kb in the process. I have not yet tested it in game, but I am just pleased that content has been created.