This is a study made by our fellow forumer
@LilSKi << all credits
Setting up correctly the trees in AC, not only helps you and make your life easier, but also improves the lighting and the performance. Therefore, it's highly recommended that you give this a read and try to follow it

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/by Lilski
Basic overview of trees in AC. There is some confusion out there as to the right and wrong way to setup trees for AC. Below are some examples of different trees and what they look like in the editor/sim.
Here they are in blender. I did 4 basic types of trees and shown in red are the object names. Two of them use the KSTREE naming scheme and two do not. The TREE on the far left has all normals set to vertical. The rest the normals are untouched from default. Also notice the vertical subdivisions.
Here they are in the editor with sun overhead. You can see we now have 4 very different trees. the far left with vertical normals is fully lit with no shading at all. Next to that we see that using the KSTREE object name has altered the normals automatically. The issue here is the entire center of the tree is dark and only the edges are lit up. Next to that in group B you can see the desired result. The only difference between A and B is the extra vertical subdivision shown above. Then TREE2 is just a disaster.
Here they are at low light. As you can see TREE is still lit from top to bottom and completely unnatural. I believe this is what most RTB trees are doing. Group A doesn't look bad but again too dark in the center. Group B again is the desired result. TREE2 still a disaster. All 4 trees here are using the same shader settings.
One important thing about the tree objects is in order for the KSTREE auto normals to work properly the origin of the object MUST be at the bottom.
Now lets discuss the whole GROUP thing. It is worth mentioning that from within blender or 3DS you MUST keep the tree objects separate. DO NOT join them together. The KSTREE naming scheme does that for you with the groups.
So here is a shot of Bridgehampton trees in blender. Selected below is GROUP_A. Notice each tree is a separate object.
Just to show here is GROUP_B. This trend goes around the whole track with GROUP_C. GROUP_D, etc.
You do not have to use A, B, C, D, etc. You can use anything like KSTREE_GROUP_PINE_, KSTREE_GROUP_MAPLE, etc. I find the letters the easiest.
This is what it will look like after you load it in the editor. there will be a section called "BLOCKTRANSFORM" and you will find the group names in there. The KSTREE_GROUP part of the name will be stripped away.
I hope this clears up some confusion. Also know that just because you use the KSTREE_GROUP_x_ naming scheme DOES NOT mean you have to use the kstree shader. The entire point of the KSTREE naming is to auto set the normals for you and join to single objects according to group name. You can also use KSTREE naming on 3D trees and it will set the normals just like a Y tree. Just make sure the origin is always at the bottom and the normals will all be done for you on import to the editor.
Some final examples of trees in sim. Notice how the bottoms are all dark as they should be.
Because you've made it this far,
HERE is a bonus

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