Hi, I double-checked the normal map handling and I think something might be off.

https://code.google.com/p/gimp-dds/source/browse/trunk/dxt.c#1296

d should be 1.0 - nx^2 - ny^2 and z should not be modified afterwards.

https://code.google.com/p/gimp-dds/source/browse/trunk/dxt.c#1314

I think the second check should be BC1 not BC5, according to the indexes used.