Reece,
When I was making (and still upgrading!) my FX mod for SH3 I used this handy little tool to convert SH4's DDS files to TGAs. It will convert to other formats also. It's called DDS converter v2.1. Here's a link to the install program I uploaded:
http://rapidshare.com/files/76892884...r_v21.exe.html
very easy to use also