RatGoatPigPossum

Sorry if this reply is too late, but I was able to fix this after having the same issue! I fixed it by changing the BC1 to BC7 and ensuring there are no mipmaps. Paint.net defaults to BC1 which I think causes the garbled textures. Attached is the window that should come up when you save over the old .dds and the settings that fixed it for me. Hope this helps you and/or anyone else who's looking for an answer!