DDS is mostly unsupported by the world except direct x tools, and there arent many of them and they are really
quickly written, so i dont recommend it, i recommend using more already worldly known formats, that actually are supported by art programs etc.
use pngs, they are losslessly compressed and can contain an alpha channel.
if you want even more compression jpg is the way to go, megatexture uses lossy jpg compression.
but it doesnt matter what you use, what video memory format you load them in as can be compressed too, but its lossy
so its best to have things in vram lossless and raw data.