Ah yes, this problem. To fix it, you simply have to add this coding into the material file for each object (it is kind of time consuming sadly though as you have to do each one individually cx)
cull_hardware none
cull_software none
alpha_rejection greater_equal 128
ambient 0.588235 0.588235 0.588235 1
diffuse 0.588235 0.588235 0.588235 1
specular 0 0 0 10 0
As for the placement of the code, it goes right before where it says 'texture_unit', for example:
material ASHENVALEFERN01
{
technique
{
pass
{
cull_hardware none
cull_software none
alpha_rejection greater_equal 128
ambient 0.588235 0.588235 0.588235 1
diffuse 0.588235 0.588235 0.588235 1
specular 0 0 0 10 0
texture_unit
{
texture ASHENVALEFERN01.tga
}
}
}
}
And that should fix your blocky problem. :3